DallasNews Corp [DALN] Filings

10-Q 1 daln-20230630x10q.htm 10-Q daln-20230630x10q

Table of Contents

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: June 30, 2023

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file no. 1-33741

DallasNews CORPORATION

(Exact name of registrant as specified in its charter)


Texas		38-3765318
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

P. O. Box 224866, Dallas, Texas 75222-4866		(214) 977-8869
(Address of principal executive offices, including zip code)		(Registrant’s telephone number, including area code)
Former name, former address and former fiscal year, if changed since last report.
None

Securities registered pursuant to Section 12(b) of the Act:




Title of each class	Trading Symbol	Name of each exchange on which registered
Series A Common Stock, $0.01 par value	DALN	The Nasdaq Stock Market LLC

Indicate by check mark whether registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.:

Large Accelerated Filer: ¨

Accelerated Filer: ¨

Non-Accelerated Filer: þ

Smaller Reporting Company: þ

Emerging Growth Company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ¨ No þ

Shares of Common Stock outstanding at July 21, 2023: 5,352,490 shares (consisting of 4,737,792 shares of Series A Common Stock and 614,698 shares of Series B Common Stock).

Table of Contents

DALLASNEWS CORPORATION

FORM 10-Q

TABLE OF CONTENTS




		Page
PART I
Item 1.	Financial Information		PAGE 3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		PAGE 16
Item 4.	Controls and Procedures		PAGE 23

PART II
Item 1.	Legal Proceedings		PAGE 24
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		PAGE 24
Item 3.	Defaults Upon Senior Securities		PAGE 24
Item 4.	Mine Safety Disclosures		PAGE 24
Item 5.	Other Information		PAGE 24
Item 6.	Exhibits		PAGE 25
Signatures			PAGE 28
Exhibit Index			PAGE 29

DallasNews Corporation Second Quarter 2023 on Form 10-Q

Table of Contents

PART I

Item 1. Financial Information

DallasNews Corporation and Subsidiaries

Consolidated Statements of Operations



	Three Months Ended June 30,				Six Months Ended June 30,
In thousands, except share and per share amounts (unaudited)	2023		2022		2023		2022
Net Operating Revenue:
Advertising and marketing services	$	16,223	$	17,457	$	31,532	$	33,721
Circulation		15,996		16,250		32,007		32,346
Printing, distribution and other		3,793		3,866		7,675		7,793
Total net operating revenue		36,012		37,573		71,214		73,860
Operating Costs and Expense:
Employee compensation and benefits		17,236		16,804		34,609		33,214
Other production, distribution and operating costs		17,293		19,725		35,321		38,974
Newsprint, ink and other supplies		2,346		2,504		4,530		4,898
Depreciation		357		716		730		1,428
Asset impairments		—		102		—		102
Total operating costs and expense		37,232		39,851		75,190		78,616
Operating loss		(1,220)		(2,278)		(3,976)		(4,756)
Other income, net		378		28		740		46
Loss Before Income Taxes		(842)		(2,250)		(3,236)		(4,710)
Income tax provision		26		165		258		349
Net Loss	$	(868)	$	(2,415)	$	(3,494)	$	(5,059)

Per Share Basis
Net loss
Basic	$	(0.16)	$	(0.45)	$	(0.65)	$	(0.95)
Number of common shares used in the per share calculation:
Basic		5,352,490		5,352,490		5,352,490		5,352,490

See the accompanying Notes to the Consolidated Financial Statements.

‎

DallasNews Corporation Second Quarter 2023 on Form 10-Q 3

Table of Contents

DallasNews Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income (Loss)



	Three Months Ended June 30,				Six Months Ended June 30,
In thousands (unaudited)	2023		2022		2023		2022
Net Loss	$	(868)	$	(2,415)	$	(3,494)	$	(5,059)
Other Comprehensive Income (Loss), Net of Tax:
Amortization of actuarial (gains) losses		(10)		131		(20)		261
Total other comprehensive income (loss), net of tax		(10)		131		(20)		261
Total Comprehensive Loss	$	(878)	$	(2,284)	$	(3,514)	$	(4,798)

See the accompanying Notes to the Consolidated Financial Statements.

‎

DallasNews Corporation Second Quarter 2023 on Form 10-Q 4

Table of Contents

DallasNews Corporation and Subsidiaries

Consolidated Balance Sheets



	June 30,		December 31,
In thousands, except share amounts (unaudited)	2023		2022
Assets
Current assets:
Cash and cash equivalents	$	11,928	$	27,825
Short-term investments		10,669		—
Accounts receivable (net of allowance of $273 and $490 at June 30, 2023 and December 31, 2022, respectively)		11,734		14,023
Inventories		2,105		2,725
Prepaids and other current assets		4,816		3,352
Total current assets		41,252		47,925
Property, plant and equipment, at cost		314,315		313,440
Less accumulated depreciation		(306,733)		(306,002)
Property, plant and equipment, net		7,582		7,438
Operating lease right-of-use assets		16,923		14,811
Deferred income taxes, net		298		282
Other assets		1,799		1,809
Total assets	$	67,854	$	72,265
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	4,130	$	5,041
Accrued compensation and benefits		4,233		4,154
Other accrued expense		3,849		4,060
Contract liabilities		10,694		9,504
Total current liabilities		22,906		22,759
Long-term pension liabilities		19,003		19,455
Long-term operating lease liabilities		17,778		16,546
Other post-employment benefits		973		982
Other liabilities		58		160
Total liabilities		60,718		59,902
Shareholders’ equity:
Preferred stock, $0.01 par value; Authorized 2,000,000 shares; none issued		—		—
Common stock, $0.01 par value; Authorized 31,250,000 shares
Series A: issued 5,216,257 and 5,216,237 shares at June 30, 2023 and December 31, 2022, respectively		52		52
Series B: issued 614,698 and 614,718 shares at June 30, 2023 and December 31, 2022, respectively		6		6
Treasury stock, Series A, at cost; 478,465 shares held at June 30, 2023 and December 31, 2022		(13,443)		(13,443)
Additional paid-in capital		494,563		494,563
Accumulated other comprehensive loss		(41,400)		(41,380)
Accumulated deficit		(432,642)		(427,435)
Total shareholders’ equity		7,136		12,363
Total liabilities and shareholders’ equity	$	67,854	$	72,265

See the accompanying Notes to the Consolidated Financial Statements.

‎

DallasNews Corporation Second Quarter 2023 on Form 10-Q 5

Table of Contents

DallasNews Corporation and Subsidiaries

Consolidated Statements of Shareholders’ Equity



	Six Months Ended June 30, 2023 and 2022
	Common Stock						Treasury Stock
In thousands, except share and per share amounts (unaudited)	Shares Series A	Shares Series B	Amount		Additional ‎Paid-in ‎Capital		Shares ‎Series A	Amount		Accumulated ‎Other ‎Comprehensive ‎Loss		Accumulated ‎Deficit		Total
Balance at December 31, 2021	5,216,045	614,910	$	58	$	494,563	(478,465)	$	(13,443)	$	(32,406)	$	(406,195)	$	42,577
Net loss	—	—		—		—	—		—		—		(5,059)		(5,059)
Other comprehensive income	—	—		—		—	—		—		261		—		261
Conversion of Series B to Series A	58	(58)		—		—	—		—		—		—		—
Dividends declared ($0.32 per share)	—	—		—		—	—		—		—		(1,713)		(1,713)
Balance at June 30, 2022	5,216,103	614,852	$	58	$	494,563	(478,465)	$	(13,443)	$	(32,145)	$	(412,967)	$	36,066
Balance at December 31, 2022	5,216,237	614,718	$	58	$	494,563	(478,465)	$	(13,443)	$	(41,380)	$	(427,435)	$	12,363
Net loss	—	—		—		—	—		—		—		(3,494)		(3,494)
Other comprehensive loss	—	—		—		—	—		—		(20)		—		(20)
Conversion of Series B to Series A	20	(20)		—		—	—		—		—		—		—
Dividends declared ($0.32 per share)	—	—		—		—	—		—		—		(1,713)		(1,713)
Balance at June 30, 2023	5,216,257	614,698	$	58	$	494,563	(478,465)	$	(13,443)	$	(41,400)	$	(432,642)	$	7,136



	Three Months Ended June 30, 2023 and 2022
	Common Stock						Treasury Stock
In thousands, except share and per share amounts (unaudited)	Shares ‎Series A	Shares ‎Series B	Amount		Additional ‎Paid-in ‎Capital		Shares ‎Series A	Amount		Accumulated ‎Other ‎Comprehensive ‎Loss		Accumulated ‎Deficit		Total
Balance at March 31, 2022	5,216,045	614,910	$	58	$	494,563	(478,465)	$	(13,443)	$	(32,276)	$	(409,695)	$	39,207
Net loss	—	—		—		—	—		—		—		(2,415)		(2,415)
Other comprehensive income	—	—		—		—	—		—		131		—		131
Conversion of Series B to Series A	58	(58)		—		—	—		—		—		—		—
Dividends declared ($0.16 per share)	—	—		—		—	—		—		—		(857)		(857)
Balance at June 30, 2022	5,216,103	614,852	$	58	$	494,563	(478,465)	$	(13,443)	$	(32,145)	$	(412,967)	$	36,066
Balance at March 31, 2023	5,216,237	614,718	$	58	$	494,563	(478,465)	$	(13,443)	$	(41,390)	$	(430,917)	$	8,871
Net loss	—	—		—		—	—		—		—		(868)		(868)
Other comprehensive loss

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10-Q	[2022-10-25]
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10-Q	[2022-04-22]
10-K	[2022-03-07]
10-Q	[2021-10-25]
10-Q	[2021-07-26]
10-Q	[2021-04-26]
10-K	[2021-03-11]
10-Q	[2020-10-26]
10-Q	[2020-07-28]
10-Q	[2020-06-05]
10-K	[2020-05-08]
10-Q	[2020-04-14]
10-Q	[2019-07-29]
10-Q	[2019-04-29]
10-K	[2019-03-14]
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10-K	[2018-03-16]
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10-Q	[2017-08-01]
10-Q	[2017-05-03]
10-K	[2017-03-10]
10-Q	[2016-11-01]
10-Q	[2016-08-02]
10-Q	[2016-05-02]
10-K	[2016-03-08]
10-Q	[2015-11-03]
10-Q	[2015-07-28]
10-Q	[2015-04-29]
10-K	[2015-03-06]
10-Q	[2014-10-30]
10-Q	[2014-07-30]
10-Q	[2014-04-30]
10-K	[2014-03-07]
10-Q	[2013-11-13]
10-Q	[2013-07-30]
10-Q	[2013-04-30]
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