Lee Enterprises, Incorporated (NYSE:LEE) Q3 2020 Earnings Conference Call - Final Transcript
Aug 06, 2020 • 10:00 am ET
Welcome to the Lee Enterprises 2020 Third Quarter Webcast and Conference Call. The call is being recorded and will be available for replay beginning later this morning at lee.net. At the close of the planned remarks, there will be an opportunity for questions. [Operator Instructions] A link to the live webcast can be found at www.lee.net.
I will now turn the call over to your host, Jamie Seratt, Corporate Controller.
Good morning. Thank you for joining us. Speaking on this morning's call will be Kevin Mowbray, President and Chief Executive Officer; and Tim Millage, Vice President and Chief Financial Officer. Also with us on today's call and available for questions is Nathan Bekke, Vice President, Consumer Sales and Marketing.
Earlier today, we issued a news release with preliminary results for our third quarter of 2020. It is available at lee.net, as well as at major financial websites. One housekeeping item to start. We closed on the acquisition of BH Media Group and The Buffalo News on March 16, 2020, and our year-to-date period results include approximately 15 weeks of operations from the acquisitions relative to the 39 weeks and the year-to-date period. Certain results and trends are presented on a pro forma basis, which assumes ownership of these acquisitions as of October 1, 2018, and include operating results from the acquisition for all periods presented.
As a reminder, this morning's discussion will include forward-looking statements that are based on our current expectations. These statements are subject to certain risks, trends and uncertainties that could cause actual results to differ materially. Such factors are described in this morning's news release and also in our SEC filings.
During the call, we make reference to certain non-GAAP financial measures, which are defined in our news release. And reconciliations to the relevant GAAP measures are included in tables accompanying the release.
And now to open the discussion is our President and Chief Executive Officer, Kevin Mowbray.
Kevin D. Mowbray
Thank you, Jamie. Good morning, and thank you all for joining the call. We're pleased with our third quarter operating results as we exceeded the high end of our revenue outlook by $2.5 million and exceeded the high end of our adjusted EBITDA outlook by nearly $3 million. We also had strong and stable revenue performance from subscription revenue and digital services. These revenue streams are predominantly contract-based, which provides for reoccurring revenue streams and more stable revenue trends.
In the quarter, more than 60% [Phonetic] of our total operating revenue was contract-based from subscriptions to our print and digital editions and digital services such as web hosting, CMS and video streaming services through TownNews. Subscription revenue was down 5% in the quarter on a pro forma basis, modestly down from the second quarter trend. Approximately 11% of subscription revenue is from single-copy sales, which were down 26.9% in the quarter due to the significant negative effects from COVID-19 and a difficult comparable to the prior year quarter. Last year, we earned $600,000 in one-time revenue in the June