New Media Investment Group Inc. (NYSE:NEWM) Q1 2018 Earnings Conference Call - Final Transcript
May 03, 2018 • 10:00 am ET
Michael E. Reed
from down 6.4% in Q3 last year and down 5.6% in Q4 last year. So this progress marks our second consecutive quarter of significant improvement in this trend. Our digital revenue in the first quarter was up 23.3% the prior year, we're up 27.8% over the prior year when excluding this accounting change. Also importantly 57% of New Media's total LTM revenue was generated from our stable or growing revenue categories.
We continue to see this important percentage grow for us which is a key contributor to our future stability. The main drivers for our organic revenue trend improvement continue to be UpCurve in GateHouse Live and we'll talk about both of those today. UpCurve revenue in the first quarter was $19.4 million and that was up 27% to the prior year. And when excluding the impact of ASC Topics 606 was up 36.3% prior year. For the LTM period revenues for UpCurve have now surpassed $75 million and represent 5.5% of total New Media revenue.
We also continue to see very strong growth in our UpCurve cloud business, which was up over 66% in the first quarter when excluding the impact of the accounting change. Beyond our quarterly revenue performance, we also had nice growth in both as adjusted EBITDA and free cash flow this quarter reflecting our focus on expense discipline, successful integration of our acquisitions and investment in new and profitable revenue initiatives. Since our last earnings call, we have remained very busy on the acquisition front.
Through May 1, we have closed five deals this year for $112.5 million and we announced the acquisition of the Akron Beacon Journal with a purchase price of $16 million. After we closed this deal expected in the second quarter, our total deals since the start of the year will be about $130 million. Given the strength of our deal pipeline, we completed an equity offering in early April that raised a $110.6 million in net proceeds. Combining the equity raise with the additional $50 million in term loan debt we took on back in February, we positioned ourselves very well to execute on our acquisition strategy.
Our net leverage at the end of the quarter was 2.0 times, EBITDA and our liquidity adjusting for the capital raise and our close transactions is $120 million. Pro forma for the closing of our deals this year, we expect our gross leverage to be below our historical target level of 2.0 times. We are also pleased to announce this morning that our Board has approved the first quarter dividend of $0.37 per share which annualizes to $1.48 per year. So 2018 is off to a great start almost all fronts. What I'd like to do now is take a moment to review the New Media portfolio and investment thesis over the next few slides.
And turning to Slide 3, New Media operates in a very large number of small to midsize communities across the country. We are the largest owner of daily