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Who is GateHouse's Investor Relations Contact? Mark Maring, Investor Relations GateHouse Media 350 WillowBrook Office Park Fairport, New York 14450 585-598-6874 Email
Use of non-GAAP financial measures
Why does the Company use non-GAAP financial measures? A non-GAAP financial measure is generally defined as one that purports to measure historical or future financial performance, financial position or cash flows, but excludes or includes amounts that would not be so adjusted in the most comparable GAAP measure. GateHouse Media defines and uses non-GAAP financial measures such as As Adjusted Revenue, Adjusted EBITDA, As Adjusted EBITDA, Levered Free Cash Flow and Unlevered Free Cash Flow. The Company strongly urges stockholders and other interested persons not to rely on any single financial measure to evaluate its business. In addition, because As Adjusted Revenue, Adjusted EBITDA, As Adjusted EBITDA, Levered Free Cash Flow and Unlevered Free Cash Flow are not measures of financial performance under GAAP and are susceptible to varying calculations, these non-GAAP measures may differ from and may not be comparable to similarly titled measures used by other companies.
How do you define As Adjusted Revenue, Adjusted EBITDA, As Adjusted EBITDA, Levered Free Cash Flow and Unlevered Free Cash Flow? The Company defines As Adjusted Revenues as total revenues plus revenues of discontinued operations while adjusting for the purchase accounting impact on revenues of the SureWest acquisition. The Company defines Adjusted EBITDA as net income (loss) before interest, income tax expense (benefit), depreciation and amortization and other non-recurring or non-cash items. The Company defines As Adjusted EBITDA as Adjusted EBITDA before other non-cash items such as non-cash compensation and non-recurring integration and reorganization costs. The Company defines Levered Free Cash Flow as As Adjusted EBITDA less capital expenditures, cash taxes and interest expense. The Company defines Unlevered Free Cash Flow as Levered Free Cash Flow plus interest expense. As Adjusted EBITDA Margin is defined as As Adjusted EBITDA divided by As Adjusted Revenue.
Why does management believe non-GAAP measures are useful to investors? As Adjusted Revenue, Adjusted EBITDA, As Adjusted EBITDA, Levered Free Cash Flow and Unlevered Free Cash Flow are not measurements of financial performance under GAAP and should not be considered in isolation or as alternatives to income from operations, net income (loss), cash flow from continuing operating activities or any other measure of performance or liquidity derived in accordance with GAAP. GateHouse Media's management believes these non-GAAP measures, as defined above, are useful to investors for the following reasons: * Evaluating performance and identifying trends in day-to-day performance because the items excluded have little or no significance on its day-to-day operations; * Providing assessments of controllable expenses that afford management the ability to make decisions which are expected to facilitate meeting current financial goals as well as achieving optimal financial performance; and * Indicators for management to determine if adjustments to current spending decisions are needed. As Adjusted Revenue, Adjusted EBITDA, As Adjusted EBITDA, Levered Free Cash Flow and Unlevered Free Cash Flow provide GateHouse Media with measures of financial performance, independent of items that are beyond the control of management in the short-term, such as depreciation and amortization, taxation and interest expense associated with its capital structure. These metrics measure GateHouse Media's financial performance based on operational factors that management can impact in the short-term, namely the cost structure or expenses of the organization. As Adjusted Revenue, Adjusted EBITDA, As Adjusted EBITDA, Levered Free Cash Flow and Unlevered Free Cash Flow are some of the metrics used by senior management and the Board of Directors to review the financial performance of the business on a monthly basis. In addition, GateHouse Media's management utilizes these metrics to evaluate the Company's performance, along with other criteria, to determine the funds available for paying the quarterly dividend.