TEGNA Broadcasting and Digital General Discussion

[Greggo 340]

I was watching KUVE news tonight, and they were showing a tribute to their employees who are retiring from the station after tonight. There are soooo many of them, I believe 9 employees. It made me sad. I'm surprised KENS down the road, also a TEGNA station, has not announced anyone retiring from their station (yet).

 

KVUE did get hit hard. Their news director, chief meteorologist, chief engineer (who helped sign the station on in the 1970s), a news producer, local sales manager and longtime receptionist were among those who took buyouts. Couple that with their GM and main male anchor leaving next month (unrelated to the buyouts) and some serious rebuilding is required.

 

They also lost their storm chaser in the high floodwaters this week. Not a good time at KVUE.

[PanchamBro 19]

TEGNA. Where we sell people in exchange for more money...

 

*sarcasm*

[KevCor 344]

TEGNA. Where we sell people in exchange for more money...

 

(sarcasm)

 

I like:

 

"It's all within reach... Except your pension. We took that. "

[Thundershock MN 169]

Perhaps TEGNA is still trying to burn off the debt from all of the spinoffs and mergers...

When Belo split into two...the TV side sucked up all of the newspaper's debt.

When Gannett purchased Belo...the debt was at $715 million.

When TEGNA split from Gannett....the debt load was a staggering $4.4 BILLION...eclipsing even Sinclair, who stands at $3.89 billion.

 

Each time, the newspaper spinoff has been the winner of being debt-free while the TV side has shouldered the burden.

I don't think this 'voluntary' early retirement package is going to help in eliminating their debt. Even a possibility of a string of layoffs won't alleviate any of the mountainous amount of debt.

It's probably a sign of things to come in future years. It's a proactive move, but if things don't go well this year revenue-wise, next year could be one reminiscent of 2009 with layoffs, furloughs, and other cutbacks to stop the bleeding....

The early retirement buyouts are a "cost control" measure. Payroll (and benefits) are usually the largest expense for most companies. So, when looking to keep expenses in line unfortunately that is one of the first places they look. These types of (or, similar) buyouts are happening at all types of companies healthy, unhealthy and those somewhere in between. Those currently closest to retirement age often have larger salaries due to tenure and a lot of them may have a pension (along with other retirement benefits) as well. Obviously, they can't just layoff everyone over 55...that would be age discrimination. But, there is nothing preventing companies from discriminating favorably against older employees...enter early retirement buyouts. Not only does this allow them to lower their payroll by replacing higher salaried workers with new low salaried employees. But, with the rising cost of insurance obligations as well as adding to years of service for pension obligations most companies want to gain a handle on those benefits as well. By convincing them to leave active employment they can gain some control and certainty around those future benefit obligations. I'm not saying I agree with the tactic but, just pointing out why it's being done.

 

TEGNA's current cash flow has been sufficient to cover their debt obligations. They repaid $587 Million in 2015. Although, that was offset by $200 Million in new borrowing so, the Net reduction was $387 Million. And, large portions of that debt doesn't mature for several years. Yes, I would agree that indirectly the buyouts help in regards to their debt. But, I wouldn't necessarily portray them as teetering on the brink of insolvency.

 

Let me give you analogy. Now before I start I will say this isn't the best analogy...it's a bit apples vs. oranges...but, I think it might help illustrate what I'm saying better. Let's say I have stable employment/income, modest savings, a decent sized "debt load" in the form of a mortgage and car loan. Although I have those debt obligations all my bills are paid on time and there is still some free cash left cover, etc., etc. One day after analyzing discretionary spending in the household budget I decide that some expenses are on an upward trajectory and need to be reigned in a bit. This doesn't mean I can't afford them or pay all of my current bills, it's more of a long-term budgeting thing. So, I make the decision to pay an ETF (or, "buyout") to get out of the remainder of my Cable TV contract and replace that with a cheaper month-to-month streaming TV service. Likewise, I do the same for my cell phone service paying an ETF (or, "buyout") to move to a cheaper service. Now, does this mean I'm on the brink of foreclosure or bankruptcy? No, not by any means. Sometimes things are simply done to control costs because the person (or, persons) in charge of the budget feels it's the fiscally responsible thing to do. A similar principal can be applied when looking at the business world. Now am I a fan of people being forced out of their job...Heck No! And, yes I'm aware that my analogy compares peoples livelihood to discretionary tv/phone service...again it's not the greatest analogy. The point I'm trying to make is that sometimes X doesn't always equal Y. Just because I cut expenses out of my personal budget doesn't mean necessarily I'm struggling. And, likewise the same can be said for a buisness

 

One person that took a buyout from another group was hit with a 40% tax bill on 25 grand buyout.

 

Ouch!

It's considered "supplemental income" by the IRS so it's subject to a higher withholding when the check is issued. Compubit already touched on this above but, most employers choose to withhold a flat 25% for the Feds on a single check (versus using an aggregate method when "supplemental income" is paid out on regular paychecks.) Now, once you add in any state and local withholding you could easily push 40%...I know first hand.

 

With that said it's important to note that all income is taxed the same at filing time. These are just withholding rates. So, It all comes out in the wash at tax filing time.

[Eat News 4738]

Very nice breakdown.

Once the buyouts are over, what will be left to cut?

 

Sales better her busy.

[PanchamBro 19]

I'm hoping that they do not remove/retire/buyout David Alan, Regina Mobley, Jeff Lawson, and Scott Cash from WVEC. They are the most recognizable news team in Hampton Roads, but they also meet the requirements for TEGNA's "50 years older, 15 years of work" requirement to be brought-out.

 

If this happens, WVEC's ratings are screwed.

[KevCor 344]

I'm hoping that they do not remove/retire/buyout David Alan, Regina Mobley, Jeff Lawson, and Scott Cash from WVEC. They are the most recognizable news team in Hampton Roads, but they also meet the requirements for TEGNA's "50 years older, 15 years of work" requirement to be brought-out.

 

If this happens, WVEC's ratings are screwed.

 

It would have happened already, as the buyouts went effective April 22. Beyond that, it'd be waiting out their contracts.

[TheRolyPoly 1843]

It would have happened already, as the buyouts went effective April 22. Beyond that, it'd be waiting out their contracts.

 

Which means if the whole team was on air yesterday, then that means they didn't take the buyout.

[KevCor 344]

Which means if the whole team was on air yesterday, then that means they didn't take the buyout.

And they were. Regina actually did the tribute pieces for Velma and Joe.

[PanchamBro 19]

And they were. Regina actually did the tribute pieces for Velma and Joe.

But if TEGNA dare to launch a second buyout, Regina might be gone. Remember, that not all TEGNA station got hit with the buyouts on Friday. So if TEGNA plans to buyout more people, that means more money for the company.

[easttxtv 7]

http://unclebarky.com/dfw_files/c20a608f4d5c84351e0beb9c1ccf208a-1303.html

 

Hard to believe, but WFAA's former sister newsgatherer in Dallas, the Morning News newspaper, had its own buyout drama almost 10 years ago as more than 100 were handed not-so-golden parachutes. This included the paper's longtime TV critic, unclebarky.com blogger Ed Bark.

 

More recently, Bark has been tallying the departures of anchors/reporters at the 4 DFW market TV news stations; they add up to more now since the beginning of 2014, but at the point of this article (http://www.unclebarky.com/dfw_files/2ff9402b1a563c2f3d76a8df5edf8ffb-3639.html), the departure count was 50 (KDFW has lost 9, KXAS - 12, WFAA - 12, KTVT - 17) from the market.

[mardek1995 200]

http://unclebarky.com/dfw_files/c20a608f4d5c84351e0beb9c1ccf208a-1303.html

 

Hard to believe, but WFAA's former sister newsgatherer in Dallas, the Morning News newspaper, had its own buyout drama almost 10 years ago as more than 100 were handed not-so-golden parachutes. This included the paper's longtime TV critic, unclebarky.com blogger Ed Bark.

 

More recently, Bark has been tallying the departures of anchors/reporters at the 4 DFW market TV news stations; they add up to more now since the beginning of 2014, but at the point of this article (http://www.unclebarky.com/dfw_files/2ff9402b1a563c2f3d76a8df5edf8ffb-3639.html), the departure count was 50 (KDFW has lost 9, KXAS - 12, WFAA - 12, KTVT - 17) from the market.

More may come thanks to TEGNA's buyouts, specifically at WFAA. And as I've said before, they'd be better off selling WFAA than keeping it and some of the station's personnel accepting buyouts, but seeing as how by this August they'll own the largest non-O&O affiliates of ABC (WFAA), NBC (WXIA), and CBS (WUSA) and keep them all, I digress

[channel2 869]

They are not about to exit their largest market, especially when that market came to their portfolio from the company they are not two and a half years removed from paying a fortune for, largely to get their hands on it.

[mardek1995 200]

They are not about to exit their largest market, especially when that market came to their portfolio from the company they are not two and a half years removed from paying a fortune for, largely to get their hands on it.

It's also because (and I'll say it again) TEGNA owns the 3 largest affiliates of ABC, NBC, and CBS

[tyrannical bastard 3442]

...meanwhile on the spinoff side of things, Gannett is offering $815 million to buy Tribune Publishing. This includes the assumption of $390 million in debt.

 

Even if the sale goes through, the debt load incurred by Gannett will pale in comparison to the debt TEGNA now carries.

[PanchamBro 19]

It's also because (and I'll say it again) TEGNA owns the 3 largest affiliates of ABC, NBC, and CBS

They don't, however, own the largest Fox and CW station, with the honors being given to Cox Media Group and Tribune Broadcasting respectively. Again, you're just focusing on the Big 3 Network. Isn't Fox and CW a network?

[KevCor 344]

...meanwhile on the spinoff side of things, Gannett is offering $815 million to buy Tribune Publishing. This includes the assumption of $390 million in debt.

 

Even if the sale goes through, the debt load incurred by Gannett will pale in comparison to the debt TEGNA now carries.

 

I felt like I knew Gannett set themselves up perfectly for M&A post split. While Tegna doesn't have much growth potential YET (they will in a year or two), Gannett has bought up a couple of publishing groups since their split.

[KevCor 344]

But if TEGNA dare to launch a second buyout, Regina might be gone. Remember, that not all TEGNA station got hit with the buyouts on Friday. So if TEGNA plans to buyout more people, that means more money for the company.

 

More may come thanks to TEGNA's buyouts, specifically at WFAA. And as I've said before, they'd be better off selling WFAA than keeping it and some of the station's personnel accepting buyouts, but seeing as how by this August they'll own the largest non-O&O affiliates of ABC (WFAA), NBC (WXIA), and CBS (WUSA) and keep them all, I digress

 

Tegna would be somewhat hard-pressed to find any more wiggle room to do another round of buyouts at this point when they can now just wait out the contracts for those who were eligible and did not accept.

 

They can (and will) just wait 2-3 more years for contracts to expire, and just not offer a renewal.

[mardek1995 200]

They don't, however, own the largest Fox and CW station, with the honors being given to Cox Media Group and Tribune Broadcasting respectively. Again, you're just focusing on the Big 3 Network. Isn't Fox and CW a network?

Fox is, but TEGNA doesn't own nearly as many fox affiliates as they do affiliates of the other 3 networks, in fact, they only own 2 and one's a semi-satellite of the other

 

I felt like I knew Gannett set themselves up perfectly for M&A post split. While Tegna doesn't have much growth potential YET (they will in a year or two), Gannett has bought up a couple of publishing groups since their split.

Ironically, Tribune's split didn't go so well. In fact, unlike Gannett, Tribune Publishing has a pretty big debt load (but as tyrannical bastard said, it's still smaller than TEGNA's) and Tribune Media isn't faring much better, especially since the fcc won't let them sell off all their properties.

[channel2 869]

Won't let them sell all those properties to one buyer - and the list of prospective buyers is strikingly smaller than it was even a few years ago (especially because, at the moment, private equity isn't interested). And we haven't heard anything lately about whether or not Tribune Media is even formally pursuing a sale of their broadcast properties.

 

Also, TEGNA knows they own ABC and CBS's largest affiliates. That is a reason to hold onto them, not sell them, unless they were in dire, dire need of financial relief, or some "activist shareholder" were pressuring them to sell.

[KevCor 344]

Fox is, but TEGNA doesn't own nearly as many fox affiliates as they do affiliates of the other 3 networks, in fact, they only own 2 and one's a semi-satellite of the other

 

They actually own three -- KMSB is still THEIR station, it's just operated by Raycom.

[WAVY 10 Fan 232]

I'm hoping that they do not remove/retire/buyout David Alan, Regina Mobley, Jeff Lawson, and Scott Cash from WVEC. They are the most recognizable news team in Hampton Roads, but they also meet the requirements for TEGNA's "50 years older, 15 years of work" requirement to be brought-out.

 

If this happens, WVEC's ratings are screwed.

 

I agree with hoping they don't get pushed out in a future buyout; but then again it's no doubt much more difficult to push out your entire weeknight news team (at the same time, anyway) than two people who, though veterans of the station and still rather visible (Joe Flanagan as weekend morning anchor in addition to the "Joe's Job" segment; Velma Scaife being the longtime reporter covering the Lower Virginia Peninsula {primarily Hampton and Newport News}) weren't the top talent on the station.

[bhratbrat 423]

yea but then across some of the others properties they own..at least one station lost a big primary anchor team and another one will be loosing the GM, News Director, and Chief Meterologist. And that station will be losing a primary anchor for different reasons. Some of the stations won't have to do much reorganization but others will have to reorganize in a hurry.

[KevCor 344]

I'm hoping that they do not remove/retire/buyout David Alan, Regina Mobley, Jeff Lawson, and Scott Cash from WVEC. They are the most recognizable news team in Hampton Roads, but they also meet the requirements for TEGNA's "50 years older, 15 years of work" requirement to be brought-out. If this happens, WVEC's ratings are screwed.

I agree with hoping they don't get pushed out in a future buyout; but then again it's no doubt much more difficult to push out your entire weeknight news team (at the same time, anyway) than two people who, though veterans of the station and still rather visible (Joe Flanagan as weekend morning anchor in addition to the "Joe's Job" segment; Velma Scaife being the longtime reporter covering the Lower Virginia Peninsula {primarily Hampton and Newport News}) weren't the top talent on the station.

 

 

David is somewhere between 15 and 16 years, because he arrived in 2000 to replace the late Terry Zahn. I think he may have escaped buyout territory by pure luck of being the youngest out of the 15+ years vets at the station.

 

That being said, I think there the ND and GM could protect a percentage of the staff who were eligible from the buyout, if so, then offer up an inference that that is exactly what ended up happening here, for a number of reasons, primarily being that WVEC currently has the oldest evening news crew in the market. Each of the other stations in the past 5-10 years have shuffled their evening lineups, but WVEC has managed, through its own miraculous ability, has kept Regina, David, Jeff and Scot together. So, they ARE poised to be that archetypal "team you know, names you trust" team. And they are poised to make a run for #1 if what many of us believe will occur when Nexstar finishes eating destroying merging with WAVY's parent, LIN Media Media General.

 

In all, even through all the changes in the market (every station except TVZ has changed ownership hands), WVEC has managed to remain pretty even keeled.

 

yea but then across some of the others properties they own..at least one station lost a big primary anchor team and another one will be loosing the GM, News Director, and Chief Meterologist. And that station will be losing a primary anchor for different reasons. Some of the stations won't have to do much reorganization but others will have to reorganize in a hurry.

 

What I think in the long run this may do, even though it won't help the books, is it will spur some of the older anchors/reporters/staff to go ahead and put in their retirement papers for the simple fact that, they can't get cut down the line if they're already on the pension. I think a lot of these seasoned vets are sensing the writing on the wall with M&As and industry consolidation and automation, that it's better to go out on their own terms rather than be drug to pasture.

[Darius22 120]

This is going to be interesting seeing KXTV and KTXL work together in my neighborhood. I already have 6 stations that work together in a single studio:

 

KCRA and KQCA

KOVR and KMAX

KUVS and KTFK

 

This could also lead to Dale shornack talking to Stephane Cruz and also possibly the ultimate breaking news team.