DALN Shareholder/Stockholder Letter Transcript:
DallasNews +7:87:)<
: 176
$QQXDO 5HSRUW
About DallasNews Corporation
DallasNews Corporation (Nasdaq: DALN) is the Dallas-based holding company of
The Dallas Morning News and Medium Giant. The Dallas Morning News is Texas leading
daily newspaper with an excellent journalistic reputation, intense regional focus and close
communityy ties. With offices in Dallas and Tulsa, Medium Giant is a full-service advertising
agencyy dedicated to designing, creating and delivering stories that drive customers to act.
DallasNews +7:87:)<
: 176
March 27, 2024
'HDU )HOORZ 6KDUHKROGHUV
7UDQVIRUPLQJ D FRPSDQ\ IURP D OHJDF\ SULQW FHQWULF EXVLQHVV WR D GLJLWDO FHQWULF EXVLQHVV LV QRW D VLPSOH
WDVN ,W UHTXLUHV IRXU HVVHQWLDO HOHPHQWV IRU LWV WUDQVIRUPDWLRQ WR EH VXFFHVVIXO DQG , VWURQJO\ EHOLHYH 'DOODV1HZV
&RUSRUDWLRQ SRVVHVVHV DOO IRXU 7KHVH HVVHQWLDO HOHPHQWV LQFOXGH RSHUDWLQJ LQ D VWURQJ SULPDU\ PDUNHW KDYLQJ
WKH QDQFLDO UHVRXUFHV WR PDNH WKH WUDQVLWLRQ PDLQWDLQLQJ RSHUDWLRQDO DQG QDQFLDO GLVFLSOLQH DQG HPSOR\LQJ
OHDGLQJ LQGXVWU\ WDOHQW WR H[HFXWH WKH YLVLRQ DQG VWUDWHJ\
7KH UVW HOHPHQW RI VXFFHVV IRU 'DOODV1HZV &RUSRUDWLRQ LV VHUYLQJ D VWURQJ SULPDU\ PDUNHW 1RUWK 7H[DV
VXUSDVVHG PLOOLRQ UHVLGHQWV LQ DQG DGGHG QHZ UHVLGHQWV RYHU WKH SDVW PRQWKV 3RSXODWLRQ
HVWLPDWHV KDYH WKH 1RUWK 7H[DV PDUNHW JURZLQJ E\ WR PLOOLRQ UHVLGHQWV E\ ZKLFK SURYLGHV ERWK
The Dallas Morning News DQG 0HGLXP *LDQW ZLWK D SULPDU\ PDUNHW WKDW LV VHFRQG WR QRQH 7KH VHFRQG HOHPHQW
LV KDYLQJ WKH QDQFLDO UHVRXUFHV WR DOORZ WKH &RPSDQ\ WKH WLPH QHFHVVDU\ WR PDNH WKH WUDQVLWLRQ 'DOODV1HZV
&RUSRUDWLRQ SRVVHVVHV D VWURQJ EDODQFH VKHHW ZLWK QR GHEW DQG WKLV LV D YLWDO UHVRXUFH DOORZLQJ XV WR PDNH RXU
WUDQVIRUPDWLRQDO VWUDWHJ\ SRVVLEOH $OWKRXJK ZH KDYH QR WUDGLWLRQDO GHEW ZH FRQWLQXH WR EH JRRG VWHZDUGV RI RXU
OHJDF\ SHQVLRQ SODQV :H IHHO VWURQJO\ WKDW WKH HPSOR\HHV ZKR KHOSHG EXLOG RXU &RPSDQ\ VKRXOG EH DEOH WR GHSHQG
RQ WKHVH 3ODQV IRU UHWLUHPHQW DQG ZH DUH FRPPLWWHG WR VHHLQJ WKHVH 3ODQV EHFRPH IXOO\ IXQGHG
7KH WKLUG FULWLFDO HOHPHQW IRU WUDQVIRUPDWLRQ LV WKH QDQFLDO DQG RSHUDWLRQDO GLVFLSOLQH QHFHVVDU\ WR PDNH
WKH WUDQVLWLRQ :KLOH ZH DUH FRPPLWWHG WR EXLOGLQJ RXU GLJLWDO R HULQJV LW LV HTXDOO\ LPSRUWDQW IRU 'DOODV1HZV
&RUSRUDWLRQ WR IRFXV RQ ZKDW ZH VKRXOG VWRS GRLQJ RQ WKH SULQW VLGH RI RXU EXVLQHVV :H KDG WZR JUHDW H[DPSOHV
RI H[HFXWLQJ WKH &RPSDQ\ V GLVFLSOLQHG DSSURDFK LQ )LUVW ZH PDGH WKH GHFLVLRQ LQ -XQH RI ODVW \HDU WR
GLVFRQWLQXH RXU :HGQHVGD\ VKDUHG PDLO SURJUDP ZKLFK KDG EHHQ D VWDSOH RI WKH SULQW QHZVSDSHU EXVLQHVV IRU
GHFDGHV $GYHUWLVHU LQWHUHVW LQ SUHSULQW DGYHUWLVLQJ KDG ZDQHG VR ZH PDGH WKH GHFLVLRQ WR GLVFRQWLQXH WKDW OLQH RI
EXVLQHVV DQG UHPRYH LWV DVVRFLDWHG H[SHQVHV 7KH VHFRQG H[DPSOH RI RXU QDQFLDO GLVFLSOLQH ZDV RXU FRQWLQXHG
IRFXV RQ GLJLWDO VXEVFULSWLRQ UHYHQXH JURZWK :KLOH PRVW QHZV RUJDQL]DWLRQV DUH RSWLQJ IRU YROXPH UDWKHU WKDQ
SULFH ZH KDYH PDLQWDLQHG RXU DSSURDFK WKDW SUHPLXP FRQWHQW PHULWV D SUHPLXP SULFH DQG LQ ZH UHSRUWHG
GLJLWDO VXEVFULSWLRQ UHYHQXH JURZWK RI RYHU
/DVW DQG PRVW LPSRUWDQW LV ZH PXVW DWWUDFW WKH EHVW WDOHQW LQ WKH LQGXVWU\ ,Q ZH DGGHG WZR LPSRUWDQW
PHPEHUV WR DQ DOUHDG\ VWURQJ 0DQDJHPHQW &RPPLWWHH ,Q 0D\ RI ODVW \HDU -RKQ .LNHU ZDV QDPHG 3UHVLGHQW RI
0HGLXP *LDQW -RKQ LV D YHWHUDQ RI WKH DGYHUWLVLQJ LQGXVWU\ DQG EULQJV KLV H[SHULHQFH DQG VWUDWHJ\ WR 0HGLXP *LDQW
WR EXLOG D VXFFHVVIXO DJHQF\ RSHUDWLQJ PRGHO WKDW KDV WKH QHHGV RI WKH FOLHQW DW WKH IRUHIURQW RI DOO GHFLVLRQV ,Q
DGGLWLRQ WR -RKQ &KULV 3DWKHLJHU MRLQHG 'DOODV1HZV &RUSRUDWLRQ DV WKH &KLHI 3URGXFW DQG ,QQRYDWLRQ 2 FHU DW WKH
HQG RI &KULV ZLOO IRFXV RQ HQKDQFLQJ RXU FXUUHQW GLJLWDO SRUWIROLR ZKLOH LGHQWLI\LQJ QHZ DXGLHQFHV DQG GLJLWDO
SURGXFWV WKDW ZLOO H[SDQG RXU GLJLWDO SURGXFW SRUWIROLR &KULV KLULQJ PDUNV D QHZ SKDVH RI RXU VWUDWHJ\ ZKHUH RXU
GLJLWDO SRUWIROLR HYROXWLRQ ZLOO SOD\ DQ HVVHQWLDO UROH LQ RXU JRDO RI DFKLHYLQJ VXVWDLQDEOH UHYHQXH JURZWK
:KLOH WKHVH IRXU FULWLFDO HOHPHQWV DUH QHHGHG WR KHOS XV PDNH WKLV WUDQVLWLRQ 'DOODV1HZV &RUSRUDWLRQ KDV
DOZD\V EHHQ LGHQWL HG E\ WKH TXDOLW\ RI RXU MRXUQDOLVP ,Q RXU QHZVURRP VXFFHVVIXOO\ H[HFXWHG RQH RI WKH
PRVW DPELWLRXV DQG LPSDFWIXO SURMHFWV SURGXFHG E\ WKH ORFDO PHGLD LQGXVWU\ 7KH VHULHV HQWLWOHG 'HDGO\ )DNH
SURYLGHG D VWRU\ HYHU\ GD\ WKURXJKRXW WKH PRQWK RI 6HSWHPEHU DERXW WKH GHDGO\ LPSDFW RI IHQWDQ\O DFURVV 1RUWK
7H[DV 2XU UHVHDUFK KHOSHG 1RUWK 7H[DQV XQGHUVWDQG WKDW IHQWDQ\O PD\ EH WKH PRVW SRWHQW DGGLFWLYH DQG VWHDOWK
GUXJ HYHU FUHDWHG ,W LV WLPHV VWURQJHU WKDQ KHURLQ DQG WLPHV PRUH SRWHQW WKDQ PRUSKLQH :H KRSH RXU XQLTXH
DSSURDFK WR VWRU\WHOOLQJ ZLOO KHOS VDYH OLYHV E\ VWDUWLQJ FRQYHUVDWLRQV WKURXJKRXW RXU FRPPXQLW\
,Q FORVLQJ , DP JUDWHIXO WR RXU VKDUHKROGHUV %RDUG RI 'LUHFWRUV DQG WKH HPSOR\HHV RI 'DOODV1HZV &RUSRUDWLRQ
IRU DOORZLQJ PH WR OHDG WKLV &RPSDQ\ WKURXJK DQ LPSRUWDQW SHULRG RI WUDQVIRUPDWLRQ :H DW 'DOODV1HZV
&RUSRUDWLRQ IHHO VWURQJO\ WKDW QRW RQO\ LV RXU IXWXUH LPSRUWDQW IRU 1RUWK 7H[DV EXW ZH DUH SDVVLRQDWHO\ FRPPLWWHG WR
QGLQJ D VXVWDLQDEOH PRGHO IRU MRXUQDOLVP DQG WKH LPSRUWDQW UROH LW SOD\V LQ RXU GHPRFUDF\
Sincerely,
Grant S. Moise
Chief Executive Officer
3/27/2024 Letter Continued (Full PDF)