Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries Graham Holdings Company Reports First Quarter Earnings By: Graham Holdings Company via Business Wire May 01, 2024 at 08:30 AM EDT 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 CONSOLIDATED STATEMENTS OF OPERATIONS (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 GRAHAM HOLDINGS COMPANY BUSINESS DIVISION INFORMATION (Unaudited) 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 23 Automotive 294,188 221,718 33 Other businesses 112,252 123,009 (9 ) Corporate office 15,212 14,073 8 Intersegment elimination (812 ) (584 ) — $ 1,117,220 $ 1,003,890 11 Operating Income (Loss) Education $ 30,587 $ 23,040 33 Television broadcasting 29,633 28,583 4 Manufacturing 3,069 7,328 (58 ) Healthcare 6,091 2,936 — Automotive 9,652 10,843 (11 ) Other businesses (28,954 ) (31,001 ) 7 Corporate office (14,636 ) (14,073 ) (4 ) $ 35,442 $ 27,656 28 Amortization of Intangible Assets and Impairment of Long-Lived Assets Education $ 2,974 $ 4,416 (33 ) Television broadcasting 1,350 1,362 (1 ) Manufacturing 3,120 4,862 (36 ) Healthcare 636 954 (33 ) Automotive — — — Other businesses 2,671 3,095 (14 ) Corporate office — — — $ 10,751 $ 14,689 (27 ) Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets Education $ 33,561 $ 27,456 22 Television broadcasting 30,983 29,945 3 Manufacturing 6,189 12,190 (49 ) Healthcare 6,727 3,890 73 Automotive 9,652 10,843 (11 ) Other businesses (26,283 ) (27,906 ) 6 Corporate office (14,636 ) (14,073 ) (4 ) $ 46,193 $ 42,345 9 Three Months Ended March 31 % (in thousands) 2024 2023 Change Depreciation Education $ 9,305 $ 8,968 4 Television broadcasting 2,868 3,036 (6 ) Manufacturing 2,715 2,282 19 Healthcare 1,594 1,104 44 Automotive 1,713 1,113 54 Other businesses 4,183 3,369 24 Corporate office 149 153 (3 ) $ 22,527 $ 20,025 12 Pension Expense Education $ 4,110 $ 2,198 87 Television broadcasting 1,639 860 91 Manufacturing 627 275 — Healthcare 4,758 4,357 9 Automotive 15 5 — Other businesses 1,940 572 — Corporate office 945 976 (3 ) $ 14,034 $ 9,243 52 Adjusted Operating Cash Flow (non-GAAP)(1) Education $ 46,976 $ 38,622 22 Television broadcasting 35,490 33,841 5 Manufacturing 9,531 14,747 (35 ) Healthcare 13,079 9,351 40 Automotive 11,380 11,961 (5 ) Other businesses (20,160 ) (23,965 ) 16 Corporate office (13,542 ) (12,944 ) (5 ) $ 82,754 $ 71,613 16 ____________ (1) Adjusted Operating Cash Flow (non-GAAP) is calculated as Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets plus Depreciation Expense and Pension Expense. GRAHAM HOLDINGS COMPANY EDUCATION DIVISION INFORMATION (Unaudited) Three Months Ended March 31 % (in thousands) 2024 2023 Change Operating Revenues Kaplan international $ 269,798 $ 227,076 19 Higher education 80,122 78,341 2 Supplemental education 72,122 73,587 (2 ) Kaplan corporate and other 2,588 2,372 9 Intersegment elimination (2,032 ) (3,335 ) — $ 422,598 $ 378,041 12 Operating Expenses Kaplan international $ 238,486 $ 205,775 16 Higher education 74,603 71,258 5 Supplemental education 67,542 69,836 (3 ) Kaplan corporate and other 10,173 7,210 41 Amortization of intangible assets 2,974 3,939 (24 ) Impairment of long-lived assets — 477 — Intersegment elimination (1,767 ) (3,494 ) — $ 392,011 $ 355,001 10 Operating Income (Loss) Kaplan international $ 31,312 $ 21,301 47 Higher education 5,519 7,083 (22 ) Supplemental education 4,580 3,751 22 Kaplan corporate and other (7,585 ) (4,838 ) (57 ) Amortization of intangible assets (2,974 ) (3,939 ) 24 Impairment of long-lived assets — (477 ) — Intersegment elimination (265 ) 159 — $ 30,587 $ 23,040 33 Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets Kaplan international $ 31,312 $ 21,301 47 Higher education 5,519 7,083 (22 ) Supplemental education 4,580 3,751 22 Kaplan corporate and other (7,585 ) (4,838 ) (57 ) Intersegment elimination (265 ) 159 — $ 33,561 $ 27,456 22 Depreciation Kaplan international $ 7,356 $ 6,330 16 Higher education 903 1,102 (18 ) Supplemental education 1,019 1,509 (32 ) Kaplan corporate and other 27 27 0 $ 9,305 $ 8,968 4 Pension Expense Kaplan international $ 163 $ 80 — Higher education 1,781 922 93 Supplemental education 1,818 1,024 78 Kaplan corporate and other 348 172 — $ 4,110 $ 2,198 87 Adjusted Operating Cash Flow (non-GAAP)(1) Kaplan international $ 38,831 $ 27,711 40 Higher education 8,203 9,107 (10 ) Supplemental education 7,417 6,284 18 Kaplan corporate and other (7,210 ) (4,639 ) (55 ) Intersegment elimination (265 ) 159 — $ 46,976 $ 38,622 22 ____________ (1) Adjusted Operating Cash Flow (non-GAAP) is calculated as Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets plus Depreciation Expense and Pension Expense. NON-GAAP FINANCIAL INFORMATION GRAHAM HOLDINGS COMPANY (Unaudited) In addition to the results reported in accordance with accounting principles generally accepted in the United States (GAAP) included in this press release, the Company has provided information regarding Adjusted Operating Cash Flow and Net income excluding certain items described below, reconciled to the most directly comparable GAAP measures. Management believes that these non-GAAP measures, when read in conjunction with the Company’s GAAP financials, provide useful information to investors by offering: the ability to make meaningful period-to-period comparisons of the Company’s ongoing results; the ability to identify trends in the Company’s underlying business; and a better understanding of how management plans and measures the Company’s underlying business. Adjusted Operating Cash Flow and Net income, excluding certain items, should not be considered substitutes or alternatives to computations calculated in accordance with and required by GAAP. These non-GAAP financial measures should be read only in conjunction with financial information presented on a GAAP basis. The gains and losses on marketable equity securities relate to the change in the fair value (quoted prices) of its portfolio of equity securities. The mandatorily redeemable noncontrolling interest represents the ownership portion of a group of minority shareholders at a subsidiary of the Company's Healthcare business. The Company measures the redemption value of this minority ownership on a quarterly basis with changes in the fair value recorded as interest expense or income, which is included in net income for the period. The effect of gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest are not directly related to the core performance of the Company’s business operations since these items do not directly relate to the sale of the Company’s services or products. The accounting principles generally accepted in the United States (“GAAP”) require that the Company include the gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest in net income on the Condensed Consolidated Statements of Operations. The Company excludes the gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest from the non-GAAP adjusted net income because these items are independent of the Company’s core operations and not indicative of the performance of the Company’s business operations. The following tables reconcile the non-GAAP financial measures for Net income, excluding certain items, to the most directly comparable GAAP measures: Three Months Ended March 31 2024 2023 Income Income before Income Net before Income Net income Taxes Income income Taxes Income (in thousands, except per share amounts) taxes taxes Amounts attributable to Graham Holdings Company Common Stockholders As reported $ 168,839 $ 43,500 $ 125,339 $ 72,177 $ 19,200 $ 52,977 Attributable to noncontrolling interests (959 ) (705 ) Attributable to Graham Holdings Company Stockholders 124,380 52,272 Adjustments: Charges related to non-operating Separation Incentive Programs 418 107 311 4,129 1,062 3,067 Net gains on marketable equity securities (104,152 ) (26,668 ) (77,484 ) (18,022 ) (4,744 ) (13,278 ) Net losses (earnings) of affiliates whose operations are not managed by the Company 1,486 380 1,106 (1,812 ) (477 ) (1,335 ) Non-operating loss (gain) from write-up, sale and impairment of cost method investments 406 104 302 (2,615 ) (660 ) (1,955 ) Interest expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest 1,876 95 1,781 1,468 75 1,393 Net Income, adjusted (non-GAAP) $ 50,396 $ 40,164 Per share information attributable to Graham Holdings Company Common Stockholders Diluted income per common share, as reported $ 27.72 $ 10.88 Adjustments: Charges related to non-operating Separation Incentive Programs 0.07 0.64 Net gains on marketable equity securities (17.27 ) (2.76 ) Net losses (earnings) of affiliates whose operations are not managed by the Company 0.25 (0.28 ) Non-operating loss (gain) from write-up, sale and impairment of cost method investments 0.07 (0.41 ) Interest expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest 0.40 0.29 Diluted income per common share, adjusted (non-GAAP) $ 11.24 $ 8.36 The adjusted diluted per share amounts may not compute due to rounding. View source version on businesswire.com: https://www.businesswire.com/news/home/20240501571011/en/Contacts Wallace R. Cooney (703) 345-6470 Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
Graham Holdings Company Reports First Quarter Earnings By: Graham Holdings Company via Business Wire May 01, 2024 at 08:30 AM EDT 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 CONSOLIDATED STATEMENTS OF OPERATIONS (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 GRAHAM HOLDINGS COMPANY BUSINESS DIVISION INFORMATION (Unaudited) 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 23 Automotive 294,188 221,718 33 Other businesses 112,252 123,009 (9 ) Corporate office 15,212 14,073 8 Intersegment elimination (812 ) (584 ) — $ 1,117,220 $ 1,003,890 11 Operating Income (Loss) Education $ 30,587 $ 23,040 33 Television broadcasting 29,633 28,583 4 Manufacturing 3,069 7,328 (58 ) Healthcare 6,091 2,936 — Automotive 9,652 10,843 (11 ) Other businesses (28,954 ) (31,001 ) 7 Corporate office (14,636 ) (14,073 ) (4 ) $ 35,442 $ 27,656 28 Amortization of Intangible Assets and Impairment of Long-Lived Assets Education $ 2,974 $ 4,416 (33 ) Television broadcasting 1,350 1,362 (1 ) Manufacturing 3,120 4,862 (36 ) Healthcare 636 954 (33 ) Automotive — — — Other businesses 2,671 3,095 (14 ) Corporate office — — — $ 10,751 $ 14,689 (27 ) Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets Education $ 33,561 $ 27,456 22 Television broadcasting 30,983 29,945 3 Manufacturing 6,189 12,190 (49 ) Healthcare 6,727 3,890 73 Automotive 9,652 10,843 (11 ) Other businesses (26,283 ) (27,906 ) 6 Corporate office (14,636 ) (14,073 ) (4 ) $ 46,193 $ 42,345 9 Three Months Ended March 31 % (in thousands) 2024 2023 Change Depreciation Education $ 9,305 $ 8,968 4 Television broadcasting 2,868 3,036 (6 ) Manufacturing 2,715 2,282 19 Healthcare 1,594 1,104 44 Automotive 1,713 1,113 54 Other businesses 4,183 3,369 24 Corporate office 149 153 (3 ) $ 22,527 $ 20,025 12 Pension Expense Education $ 4,110 $ 2,198 87 Television broadcasting 1,639 860 91 Manufacturing 627 275 — Healthcare 4,758 4,357 9 Automotive 15 5 — Other businesses 1,940 572 — Corporate office 945 976 (3 ) $ 14,034 $ 9,243 52 Adjusted Operating Cash Flow (non-GAAP)(1) Education $ 46,976 $ 38,622 22 Television broadcasting 35,490 33,841 5 Manufacturing 9,531 14,747 (35 ) Healthcare 13,079 9,351 40 Automotive 11,380 11,961 (5 ) Other businesses (20,160 ) (23,965 ) 16 Corporate office (13,542 ) (12,944 ) (5 ) $ 82,754 $ 71,613 16 ____________ (1) Adjusted Operating Cash Flow (non-GAAP) is calculated as Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets plus Depreciation Expense and Pension Expense. GRAHAM HOLDINGS COMPANY EDUCATION DIVISION INFORMATION (Unaudited) Three Months Ended March 31 % (in thousands) 2024 2023 Change Operating Revenues Kaplan international $ 269,798 $ 227,076 19 Higher education 80,122 78,341 2 Supplemental education 72,122 73,587 (2 ) Kaplan corporate and other 2,588 2,372 9 Intersegment elimination (2,032 ) (3,335 ) — $ 422,598 $ 378,041 12 Operating Expenses Kaplan international $ 238,486 $ 205,775 16 Higher education 74,603 71,258 5 Supplemental education 67,542 69,836 (3 ) Kaplan corporate and other 10,173 7,210 41 Amortization of intangible assets 2,974 3,939 (24 ) Impairment of long-lived assets — 477 — Intersegment elimination (1,767 ) (3,494 ) — $ 392,011 $ 355,001 10 Operating Income (Loss) Kaplan international $ 31,312 $ 21,301 47 Higher education 5,519 7,083 (22 ) Supplemental education 4,580 3,751 22 Kaplan corporate and other (7,585 ) (4,838 ) (57 ) Amortization of intangible assets (2,974 ) (3,939 ) 24 Impairment of long-lived assets — (477 ) — Intersegment elimination (265 ) 159 — $ 30,587 $ 23,040 33 Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets Kaplan international $ 31,312 $ 21,301 47 Higher education 5,519 7,083 (22 ) Supplemental education 4,580 3,751 22 Kaplan corporate and other (7,585 ) (4,838 ) (57 ) Intersegment elimination (265 ) 159 — $ 33,561 $ 27,456 22 Depreciation Kaplan international $ 7,356 $ 6,330 16 Higher education 903 1,102 (18 ) Supplemental education 1,019 1,509 (32 ) Kaplan corporate and other 27 27 0 $ 9,305 $ 8,968 4 Pension Expense Kaplan international $ 163 $ 80 — Higher education 1,781 922 93 Supplemental education 1,818 1,024 78 Kaplan corporate and other 348 172 — $ 4,110 $ 2,198 87 Adjusted Operating Cash Flow (non-GAAP)(1) Kaplan international $ 38,831 $ 27,711 40 Higher education 8,203 9,107 (10 ) Supplemental education 7,417 6,284 18 Kaplan corporate and other (7,210 ) (4,639 ) (55 ) Intersegment elimination (265 ) 159 — $ 46,976 $ 38,622 22 ____________ (1) Adjusted Operating Cash Flow (non-GAAP) is calculated as Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets plus Depreciation Expense and Pension Expense. NON-GAAP FINANCIAL INFORMATION GRAHAM HOLDINGS COMPANY (Unaudited) In addition to the results reported in accordance with accounting principles generally accepted in the United States (GAAP) included in this press release, the Company has provided information regarding Adjusted Operating Cash Flow and Net income excluding certain items described below, reconciled to the most directly comparable GAAP measures. Management believes that these non-GAAP measures, when read in conjunction with the Company’s GAAP financials, provide useful information to investors by offering: the ability to make meaningful period-to-period comparisons of the Company’s ongoing results; the ability to identify trends in the Company’s underlying business; and a better understanding of how management plans and measures the Company’s underlying business. Adjusted Operating Cash Flow and Net income, excluding certain items, should not be considered substitutes or alternatives to computations calculated in accordance with and required by GAAP. These non-GAAP financial measures should be read only in conjunction with financial information presented on a GAAP basis. The gains and losses on marketable equity securities relate to the change in the fair value (quoted prices) of its portfolio of equity securities. The mandatorily redeemable noncontrolling interest represents the ownership portion of a group of minority shareholders at a subsidiary of the Company's Healthcare business. The Company measures the redemption value of this minority ownership on a quarterly basis with changes in the fair value recorded as interest expense or income, which is included in net income for the period. The effect of gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest are not directly related to the core performance of the Company’s business operations since these items do not directly relate to the sale of the Company’s services or products. The accounting principles generally accepted in the United States (“GAAP”) require that the Company include the gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest in net income on the Condensed Consolidated Statements of Operations. The Company excludes the gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest from the non-GAAP adjusted net income because these items are independent of the Company’s core operations and not indicative of the performance of the Company’s business operations. The following tables reconcile the non-GAAP financial measures for Net income, excluding certain items, to the most directly comparable GAAP measures: Three Months Ended March 31 2024 2023 Income Income before Income Net before Income Net income Taxes Income income Taxes Income (in thousands, except per share amounts) taxes taxes Amounts attributable to Graham Holdings Company Common Stockholders As reported $ 168,839 $ 43,500 $ 125,339 $ 72,177 $ 19,200 $ 52,977 Attributable to noncontrolling interests (959 ) (705 ) Attributable to Graham Holdings Company Stockholders 124,380 52,272 Adjustments: Charges related to non-operating Separation Incentive Programs 418 107 311 4,129 1,062 3,067 Net gains on marketable equity securities (104,152 ) (26,668 ) (77,484 ) (18,022 ) (4,744 ) (13,278 ) Net losses (earnings) of affiliates whose operations are not managed by the Company 1,486 380 1,106 (1,812 ) (477 ) (1,335 ) Non-operating loss (gain) from write-up, sale and impairment of cost method investments 406 104 302 (2,615 ) (660 ) (1,955 ) Interest expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest 1,876 95 1,781 1,468 75 1,393 Net Income, adjusted (non-GAAP) $ 50,396 $ 40,164 Per share information attributable to Graham Holdings Company Common Stockholders Diluted income per common share, as reported $ 27.72 $ 10.88 Adjustments: Charges related to non-operating Separation Incentive Programs 0.07 0.64 Net gains on marketable equity securities (17.27 ) (2.76 ) Net losses (earnings) of affiliates whose operations are not managed by the Company 0.25 (0.28 ) Non-operating loss (gain) from write-up, sale and impairment of cost method investments 0.07 (0.41 ) Interest expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest 0.40 0.29 Diluted income per common share, adjusted (non-GAAP) $ 11.24 $ 8.36 The adjusted diluted per share amounts may not compute due to rounding. View source version on businesswire.com: https://www.businesswire.com/news/home/20240501571011/en/Contacts Wallace R. Cooney (703) 345-6470
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 CONSOLIDATED STATEMENTS OF OPERATIONS (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 GRAHAM HOLDINGS COMPANY BUSINESS DIVISION INFORMATION (Unaudited) 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 23 Automotive 294,188 221,718 33 Other businesses 112,252 123,009 (9 ) Corporate office 15,212 14,073 8 Intersegment elimination (812 ) (584 ) — $ 1,117,220 $ 1,003,890 11 Operating Income (Loss) Education $ 30,587 $ 23,040 33 Television broadcasting 29,633 28,583 4 Manufacturing 3,069 7,328 (58 ) Healthcare 6,091 2,936 — Automotive 9,652 10,843 (11 ) Other businesses (28,954 ) (31,001 ) 7 Corporate office (14,636 ) (14,073 ) (4 ) $ 35,442 $ 27,656 28 Amortization of Intangible Assets and Impairment of Long-Lived Assets Education $ 2,974 $ 4,416 (33 ) Television broadcasting 1,350 1,362 (1 ) Manufacturing 3,120 4,862 (36 ) Healthcare 636 954 (33 ) Automotive — — — Other businesses 2,671 3,095 (14 ) Corporate office — — — $ 10,751 $ 14,689 (27 ) Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets Education $ 33,561 $ 27,456 22 Television broadcasting 30,983 29,945 3 Manufacturing 6,189 12,190 (49 ) Healthcare 6,727 3,890 73 Automotive 9,652 10,843 (11 ) Other businesses (26,283 ) (27,906 ) 6 Corporate office (14,636 ) (14,073 ) (4 ) $ 46,193 $ 42,345 9 Three Months Ended March 31 % (in thousands) 2024 2023 Change Depreciation Education $ 9,305 $ 8,968 4 Television broadcasting 2,868 3,036 (6 ) Manufacturing 2,715 2,282 19 Healthcare 1,594 1,104 44 Automotive 1,713 1,113 54 Other businesses 4,183 3,369 24 Corporate office 149 153 (3 ) $ 22,527 $ 20,025 12 Pension Expense Education $ 4,110 $ 2,198 87 Television broadcasting 1,639 860 91 Manufacturing 627 275 — Healthcare 4,758 4,357 9 Automotive 15 5 — Other businesses 1,940 572 — Corporate office 945 976 (3 ) $ 14,034 $ 9,243 52 Adjusted Operating Cash Flow (non-GAAP)(1) Education $ 46,976 $ 38,622 22 Television broadcasting 35,490 33,841 5 Manufacturing 9,531 14,747 (35 ) Healthcare 13,079 9,351 40 Automotive 11,380 11,961 (5 ) Other businesses (20,160 ) (23,965 ) 16 Corporate office (13,542 ) (12,944 ) (5 ) $ 82,754 $ 71,613 16 ____________ (1) Adjusted Operating Cash Flow (non-GAAP) is calculated as Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets plus Depreciation Expense and Pension Expense. GRAHAM HOLDINGS COMPANY EDUCATION DIVISION INFORMATION (Unaudited) Three Months Ended March 31 % (in thousands) 2024 2023 Change Operating Revenues Kaplan international $ 269,798 $ 227,076 19 Higher education 80,122 78,341 2 Supplemental education 72,122 73,587 (2 ) Kaplan corporate and other 2,588 2,372 9 Intersegment elimination (2,032 ) (3,335 ) — $ 422,598 $ 378,041 12 Operating Expenses Kaplan international $ 238,486 $ 205,775 16 Higher education 74,603 71,258 5 Supplemental education 67,542 69,836 (3 ) Kaplan corporate and other 10,173 7,210 41 Amortization of intangible assets 2,974 3,939 (24 ) Impairment of long-lived assets — 477 — Intersegment elimination (1,767 ) (3,494 ) — $ 392,011 $ 355,001 10 Operating Income (Loss) Kaplan international $ 31,312 $ 21,301 47 Higher education 5,519 7,083 (22 ) Supplemental education 4,580 3,751 22 Kaplan corporate and other (7,585 ) (4,838 ) (57 ) Amortization of intangible assets (2,974 ) (3,939 ) 24 Impairment of long-lived assets — (477 ) — Intersegment elimination (265 ) 159 — $ 30,587 $ 23,040 33 Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets Kaplan international $ 31,312 $ 21,301 47 Higher education 5,519 7,083 (22 ) Supplemental education 4,580 3,751 22 Kaplan corporate and other (7,585 ) (4,838 ) (57 ) Intersegment elimination (265 ) 159 — $ 33,561 $ 27,456 22 Depreciation Kaplan international $ 7,356 $ 6,330 16 Higher education 903 1,102 (18 ) Supplemental education 1,019 1,509 (32 ) Kaplan corporate and other 27 27 0 $ 9,305 $ 8,968 4 Pension Expense Kaplan international $ 163 $ 80 — Higher education 1,781 922 93 Supplemental education 1,818 1,024 78 Kaplan corporate and other 348 172 — $ 4,110 $ 2,198 87 Adjusted Operating Cash Flow (non-GAAP)(1) Kaplan international $ 38,831 $ 27,711 40 Higher education 8,203 9,107 (10 ) Supplemental education 7,417 6,284 18 Kaplan corporate and other (7,210 ) (4,639 ) (55 ) Intersegment elimination (265 ) 159 — $ 46,976 $ 38,622 22 ____________ (1) Adjusted Operating Cash Flow (non-GAAP) is calculated as Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets plus Depreciation Expense and Pension Expense. NON-GAAP FINANCIAL INFORMATION GRAHAM HOLDINGS COMPANY (Unaudited) In addition to the results reported in accordance with accounting principles generally accepted in the United States (GAAP) included in this press release, the Company has provided information regarding Adjusted Operating Cash Flow and Net income excluding certain items described below, reconciled to the most directly comparable GAAP measures. Management believes that these non-GAAP measures, when read in conjunction with the Company’s GAAP financials, provide useful information to investors by offering: the ability to make meaningful period-to-period comparisons of the Company’s ongoing results; the ability to identify trends in the Company’s underlying business; and a better understanding of how management plans and measures the Company’s underlying business. Adjusted Operating Cash Flow and Net income, excluding certain items, should not be considered substitutes or alternatives to computations calculated in accordance with and required by GAAP. These non-GAAP financial measures should be read only in conjunction with financial information presented on a GAAP basis. The gains and losses on marketable equity securities relate to the change in the fair value (quoted prices) of its portfolio of equity securities. The mandatorily redeemable noncontrolling interest represents the ownership portion of a group of minority shareholders at a subsidiary of the Company's Healthcare business. The Company measures the redemption value of this minority ownership on a quarterly basis with changes in the fair value recorded as interest expense or income, which is included in net income for the period. The effect of gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest are not directly related to the core performance of the Company’s business operations since these items do not directly relate to the sale of the Company’s services or products. The accounting principles generally accepted in the United States (“GAAP”) require that the Company include the gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest in net income on the Condensed Consolidated Statements of Operations. The Company excludes the gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest from the non-GAAP adjusted net income because these items are independent of the Company’s core operations and not indicative of the performance of the Company’s business operations. The following tables reconcile the non-GAAP financial measures for Net income, excluding certain items, to the most directly comparable GAAP measures: Three Months Ended March 31 2024 2023 Income Income before Income Net before Income Net income Taxes Income income Taxes Income (in thousands, except per share amounts) taxes taxes Amounts attributable to Graham Holdings Company Common Stockholders As reported $ 168,839 $ 43,500 $ 125,339 $ 72,177 $ 19,200 $ 52,977 Attributable to noncontrolling interests (959 ) (705 ) Attributable to Graham Holdings Company Stockholders 124,380 52,272 Adjustments: Charges related to non-operating Separation Incentive Programs 418 107 311 4,129 1,062 3,067 Net gains on marketable equity securities (104,152 ) (26,668 ) (77,484 ) (18,022 ) (4,744 ) (13,278 ) Net losses (earnings) of affiliates whose operations are not managed by the Company 1,486 380 1,106 (1,812 ) (477 ) (1,335 ) Non-operating loss (gain) from write-up, sale and impairment of cost method investments 406 104 302 (2,615 ) (660 ) (1,955 ) Interest expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest 1,876 95 1,781 1,468 75 1,393 Net Income, adjusted (non-GAAP) $ 50,396 $ 40,164 Per share information attributable to Graham Holdings Company Common Stockholders Diluted income per common share, as reported $ 27.72 $ 10.88 Adjustments: Charges related to non-operating Separation Incentive Programs 0.07 0.64 Net gains on marketable equity securities (17.27 ) (2.76 ) Net losses (earnings) of affiliates whose operations are not managed by the Company 0.25 (0.28 ) Non-operating loss (gain) from write-up, sale and impairment of cost method investments 0.07 (0.41 ) Interest expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest 0.40 0.29 Diluted income per common share, adjusted (non-GAAP) $ 11.24 $ 8.36 The adjusted diluted per share amounts may not compute due to rounding. 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