The E.W. Scripps Company (NASDAQ:SSP) Q3 2023 Earnings Call Transcript

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Back in January we announced under reorganization of the company aimed at align all of our assets and the people to the best capture the opportunities in the media ecosystem. The reorganization is unfolding as we intended to transform our company and improve margins fuel growth and leverage the strength of our position in serving our audiences and communities. As Jason said, we are expecting to realize more than $40 million in savings through the reorg with about 80% of that coming from eliminating positions and the rest from external spending such as vendor contracts. But as you know a company can’t cut its way to growth. And the most important part of our work is what we’re doing to reposition ourselves to thrive in the changing media landscape.

Our approach to the reorganization has been fourfold. First, we have combined many corporate management roles that were separately housed in Local Media and Scripps Networks divisions. So, we now have leaders who are responsible for their areas across the enterprise. For example we hired a Chief Revenue Officer from NBC Universal who oversees both local station and network sales and is charged with thinking holistically about the company’s revenue growth. His work already is leading to benefits ranging from better use of sales technology to more effective sales messaging and execution to the consolidation of vendor contracts. Second, as our leaders have taken on these broader roles, they have centralized teams in our local stations including Human Resources, Finance, and Marketing in a way that is appropriate for a company of our size and in line with our local broadcast peers.

Third, our local media station newsrooms are rethinking how we adapt to what our audiences and communities want from their local news. We’ve undertaken extensive audience research over the last six years including focuses on black Hispanic and rural households. These learnings have informed our approach to local coverage and that we will serve viewers and audiences in the future. One key change is the redeployment of our anchor rolls in some markets so we can put more journalists in the field rather than broadcasting from a studio with a traditional anchor desk more of our newscasts are filled with reporters telling stories from out in their cities and neighborhoods. We’re also running Scripps news on our local stations. This has three benefits; it puts Scripps news brand in front of large new audiences; it allows local stations to use the quality objective national content Scripps news produces; and it saves on programming cost.

We’re now airing 63 hours a week of Scripps news live on 48 local stations with advertising sold by the local teams and the ratings are steadily growing. For example, stations that use Scripps News morning rush program saw viewership bill by 12% from June to September and Scripps news live programming is delivering sustained year-over-year ratings growth of 4%. The fourth and very important part of the reorganization was — has been the emergence of Scripps Sports led by Brian Lawlor. It has been crucial for Brian and his team as they build out our reputation as a sports media partner to have support from people who think about all of our assets from the market depth of our local stations to the national and demographic reach of ION other networks.

As we are putting together local and national deals, we are creatively deploying assets from both local media and Scripps Networks unencumbered by where they sit in the organization. We will wrap-up most of our global work this year and we’ll realize our full savings after our local stations complete their transitions in the first half of next year. But the true value of our transformation will come as these changes take root. We are forming new and even deeper connections with our audiences and advertisers through news, sports and other quality entertainment programming on every platform where Americans watch TV. The enterprise value we’re creating will propel our growth and perpetuation. I’d like to close by calling out the most recent awards of our impactful journalism.

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