Gray Television Makes Significant Progress on Debt Reduction and Replenishes Authorization for Additional Debt Reduction

Rhea-AI Summary

Gray Television has successfully reduced its outstanding debt by $278 million since October 1, 2024, bringing total debt reduction to $519 million for 2024. The company used approximately $204 million of cash to repurchase and retire about $239 million of principal debt through various transactions since November 8, 2024. The Board has authorized a replenishment of the debt repurchase program to $250 million. The debt reduction is expected to significantly lower cash interest expenses. The transactions included repurchases across Term Loan D, 2027 Notes, 2030 Notes, and 2031 Notes.

Positive

• Achieved $519 million in total debt reduction since January 2024
• Secured favorable debt repurchase terms, using $204 million to retire $239 million in debt
• Expected reduction in cash interest expenses
• Board authorized new $250 million debt repurchase program

Negative

• Still maintains substantial total debt of $5.691 billion
• High interest rates on remaining notes (up to 10.5% on Senior Secured Notes)

Insights

Financial Analyst

Gray Television's aggressive debt reduction strategy marks a significant financial milestone, reducing outstanding debt by $278 million since October and $519 million year-to-date. The company's strategic debt repurchases at discounted rates demonstrate effective capital management, particularly the recent $204 million cash deployment to retire $239 million in debt, capturing a meaningful discount.

The new $250 million debt repurchase authorization signals management's continued commitment to deleveraging. With total debt now at $5.69 billion, down from $6.21 billion at 2023 year-end, the reduced interest burden will improve free cash flow and strengthen the balance sheet. The company's focus on retiring higher-cost unsecured notes while maintaining secured debt reflects a strategic approach to optimizing the capital structure.

ATLANTA, Nov. 20, 2024 (GLOBE NEWSWIRE) -- Gray Television, Inc. (“Gray,” “Gray Media,” the “Company,” “we,” “us” or “our”) (NYSE: GTN) has completed a series of transactions that collectively reduced the Company’s principal amount of debt outstanding by $278 million since October 1, 2024, bringing the Company’s total principal debt reduction to $519 million since January 1, 2024.  Accordingly, our Board of Directors today has authorized an increase in our previously announced debt repurchase authorization, replenishing the authorization to a total of $250 million of available liquidity to repurchase our outstanding indebtedness.  We anticipate that the meaningful reduction in our outstanding debt this year will result in a significant reduction of cash interest expense going forward.

Through various recently completed transactions since November 8, 2024, we have used approximately $204 million of cash on hand to repurchase and retire approximately $239 million of principal amount of debt consisting of:

(a) $5 million of outstanding principal of Term Loan D due December 1, 2028,
(b) $143 million of outstanding principal of 2027 Notes,
(c) $10 million of outstanding principal of 2030 Notes, and
(d) $81 million of outstanding principal of 2031 Notes. 

As a result of these transactions, the Company currently has outstanding debt in the following principal amounts:

Principal Amount Outstanding ($ in millions)	December 31, 2023 Actual		September 30, 2024 Actual		November 20, 2024 Actual
Revolving Credit Facility due 12/31/2027 ($680 million commitment)			-		-
2021 Term Loan due 12/1/2028 (S + 300)			$1,439		$1,395
2024 Term Loan due 6/4/2029 (S + 525)			499		499
10.5% Senior Secured Notes due 7/15/2029			1,250		1,250
Total outstanding principal secured by a first lien	$2,660		$3,188		$3,144
5.875% Senior Unsecured Notes due 7/15/2026			10		10
7.000% Senior Unsecured Notes due 5/15/2027			671		528
4.750% Senior Unsecured Notes due 10/15/2030			800		790
5.375% Senior Unsecured Notes due 11/15/2031			1,300		1,219
Total outstanding principal, including current portion	$6,210		$5,969		$5,691

The extent of future repurchases, including the amount and timing of any repurchases, will depend on general market conditions, regulatory requirements, alternative investment opportunities and other considerations.  This repurchase program supersedes any previous repurchase authorization, does not require us to repurchase a minimum amount of debt, and it may be modified, suspended or terminated at any time without prior notice.

Forward-Looking Statements: 

This press release contains certain forward-looking statements that are based largely on Gray’s current expectations and reflect various estimates and assumptions by Gray.  These statements are statements other than those of historical fact and may be identified by words such as “estimates,” “expect,” “anticipate,” “will,” “implied,” “intend,” “assume” and similar expressions. Forward-looking statements are subject to certain risks, trends and uncertainties that could cause actual results and achievements to differ materially from those expressed in such forward-looking statements. Such risks, trends and uncertainties, which in some instances are beyond Gray’s control, include Gray’s ability to complete its debt repurchasing efforts on the terms and within the timeframe currently contemplated, the reduction of cash interest expenses, and other future events. Gray is subject to additional risks and uncertainties described in Gray’s quarterly and annual reports filed with the Securities and Exchange Commission from time to time, including in the “Risk Factors,” and management’s discussion and analysis of financial condition and results of operations sections contained therein, which reports are made publicly available via its website, www.gray.tv. Any forward-looking statements in this communication should be evaluated in light of these important risk factors.  This press release reflects management’s views as of the date hereof. Except to the extent required by applicable law, Gray undertakes no obligation to update or revise any information contained in this communication beyond the date hereof, whether as a result of new information, future events or otherwise.

About Gray:

Gray Media, or Gray, is a multimedia company headquartered in Atlanta, Georgia, formally known as Gray Television, Inc. The company is the nation’s largest owner of top-rated local television stations and digital assets serving 113 television markets that collectively reach approximately 36 percent of US television households. The portfolio includes 77 markets with the top-rated television station and 100 markets with the first and/or second highest rated television station, as well as the largest Telemundo Affiliate group with 43 markets totaling nearly 1.5 million Hispanic TV Households. The company also owns Gray Digital Media, a full-service digital agency offering national and local clients digital marketing strategies with the most advanced digital products and services. Gray’s additional media properties include video production companies Raycom Sports, Tupelo Media Group, and PowerNation Studios, and studio production facilities Assembly Atlanta and Third Rail Studios. Gray owns a majority interest in Swirl Films. For more information, please visit www.graymedia.com.

Gray Contacts:

Jeff Gignac, Executive Vice President and Chief Financial Officer, 404-504-9828
Kevin P. Latek, Executive Vice President, Chief Legal and Development Officer, 404-266-8333

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FAQ

How much debt has Gray Television (GTN) reduced in 2024?

Gray Television has reduced its debt by $519 million since January 1, 2024, including $278 million since October 1, 2024.

What is the new debt repurchase authorization for Gray Television (GTN)?

Gray Television's Board has authorized a replenishment of the debt repurchase program to $250 million.

How much cash did Gray Television (GTN) use for recent debt repurchases?

Gray Television used approximately $204 million in cash to repurchase and retire about $239 million of principal debt since November 8, 2024.