Good morning, everyone. I cannot believe that we are almost halfway through the year. I wanted to take this time to update you on how we are doing. As always, by the numbers first:
- YTD April-Total Revenue: +16% vs. prior year, exceeded our forecast and April was our top revenue month to-date as a Company.
- May revenue is pacing to finish +10% to PY and will be our highest monthly revenue ever. Our full year forecast to grow revenue by 10-13% is very well intact.
- We have over 7,100 unique advertisers through April.
- EBITDA: 10% margin, exceeded our forecast and positions us to outperform what we set out to achieve in 2024 (15% or higher).
- Cash flow is strong and has gained momentum each month this year except for January. This positions us nicely to continue paying down our debt. Net debt leverage is currently pacing at .87x, which demonstrates that our strategy to leverage debt to build the company is working.
- Audience strength is super-impressive: Over 62MM print and digital in audience annualized (print readership + pageviews). Over 91MM online events annualized. Over 900K monthly online users. 70K email subscribers and 167K Facebook Followers.
Our strategy is primarily driven by advertising revenue, and we are a profit driven business. Intense focus and continued investment in the Sales organization is mission-critical so that we exceed our revenue goals and fund the resources necessary to continue building a viable, nicely profitable media company. We provide excellent local news coverage and impactful original reporting with an excellent team of editors and reporters. Our support staff in each functional area helps bring it all together!
I really enjoyed spending time in April at the America’s Newspapers Mega Conference and what a bonus that it was in Phoenix, just 25 minutes from corporate HQ—a small home office. It was great to learn from what is working for other peer companies (took pages of notes) and the networking in and of itself makes for a great ROT (return on time).
People/Culture
As I have written in the past, we do not have a corporate HQ because we want to keep resources in the local markets where they belong. OMG brings a contrarian business mindset to the media industry. We do not have corporate VP’s and suits telling anyone in the field what to do; nobody in the company even wears a suit, except for a big sales call or two. We will never waver from this part of our strategy. At some point later in life, I will absolutely publish a book of my journey, and I promise that one of the longest chapters will cover my views on corporate and how it can ruin a company.
The OMG team at each level of the organization continues to improve and perform. We have excellent employee retention, and we continue to add talent to the team, just about every month. The main reason we are growing revenue and the bottom-line, most likely industry-leading, is a result of the investments that we made in 2023 in people, process improvement and technology. Results fall below expectations at times, and we really did not perform well last year (total revenue +22% vs. prior year; expected +35-40%). However, instead of laying off, doing furloughs and firing people, we work together, hunker down and figure it out.
We are lucky to have such an amazing management team, and they each deserve special recognition for their work. Our structure is loose, and we really do not care who works for who because we are all in the same circle. This team below could run any size media company in the industry; they are all punching above their weight. This is the gang that gets an email update 2x/week (a few much more frequently) on our revenue performance to go along with call-outs and explanations; the numbers do most of the talking: Caleb Anderson, Joe Mathes, Joe Paul, Pam Mathes, Jade Lewandowski, Megan Ivey, Sally Shepherd, Dave Pevonka, Chad Richardson, Jeff Wolfe, Shari Pierce, Michele Swain, Vicky Mashew, Ray Paul, Stephanie Wagner (recently added), Perry Corsetti (new in May), Sharon Schjoth and Rachel Machia. Anyone in this group that manages some part of the sales operation also maintains and drives growth with their own book of business. This is very unique and, quite honestly, another anti-corporate activity. Perry Corsetti warmed my heart last week after a Google Meet with Megan Ivey, who was taking him through how the digital fulfillment team rolls. Right after the meeting, he told me that everyone he has worked with so far since joining OMG is happy. That simple comment is just as important as profit growth!
People are truly our differentiator when it comes to the results we produce and the communities, readers, and local businesses we serve.
Personally Speaking
A bunch of us in the Company engage and share health and fitness tips, and it is something that I really love about what we are building at OMG. Topics range all over the place—gym routines, hiking, biking, racquetball, weight training, nutrition, spinning, supplement intake, books to read, Tik Toks shared, breathing techniques and on and on. Some of the books I have read in the past year on health and fitness have changed my game personally, and I attribute that to people on our team—Emerson Lynn (working out is a life style and everyday commitment); Joe Mathes (many books and Tik Toks shared), Caleb Anderson (every time I try to call him after hours, he is at the gym), Sally Shepherd (teaches spin classes and recently shared a 25% off Lululemon discount with me-love those!), Joe Paul and his knowledge of nutrition and supplements and much more.
Here is a game changing book recommendation: “Outlive”—The Science & Art of Longevity by Peter Attia, MD. He goes a little too deep in certain chapters, but overall, this was a fantastic book with lots of easy-to-understand action items. His basic premise is that focus, and action should be aimed at prevention vs. treatment of issues and sickness after it happens. I love that he studied people in certain regions of the world who lived to be 100+ years old. Exercise, strength training, nutrition, caloric restriction, sleep (eight hours/day—tough to do!) and emotional health are the main subjects written about at length in the book. If sharing this helps one person that is reading this article, it will have been well worth it! And if anyone in OMG is interested in the book, shoot me an email, and I will personally pay for and send one to your home.
As time allows this year, we are going to launch an internal company initiative to publicize and drive engagement around health and fitness. I feel like we have experts on the team that can write about and share best practices, and we will be engaging an outside trainer/nutritionist to enhance our efforts. More to come once we launch a blog and make this all more actionable. Who knows, maybe this evolves and leads to information that we publish in our newspapers, newsletters and on our websites.
Company Highlights
Acquisitions: We have completed 14 acquisitions since starting the company in December 2018. All of the transitions have been both exciting and challenging, but I do feel like we are getting good at this because of the people at the company acquired joining OMG post-sale and our team, plus the back end, systems, and digital infrastructure that we have built out. We are ready to continue on our path to intelligently scale!
AR-Cash Flow Management: Our sales and support teams are doing a great job with steadily improving turn on cash flow. Why is this an important focus area for the Company—because it is just smart business to get paid in a timely manner and not carry and manage a headachy AR and balances rolling into 45, 60, 90 or 120 days. Our success has been driven by the following tactics:
- Sales and support teams working together-the biggest factor. They have changed the game with AR management at OMG. We do not have anyone dedicated to just collections-just like corporate, that would be a waste of resources.
- We get a lot of payments upfront via credit card or ACH, especially with our digital campaigns.
- In most of our markets, we process invoices mid-month and end of month.
- 90% of invoices are sent out via email and offer a two click option in the body of the email for the advertiser to pay via the system payment portal.
- We work together on minimizing risk upfront when making sales (i.e. if a business does not have any history advertising and paying). Several markets do this exceptionally well and others are improving.
News/Editorial: Keeping our products and content front and center are a key driver to our strategy. Here is a link that summarizes all the awards News teams have been recognized for in the past year https://bit.ly/Omgawards. Very impressive work! I also wanted to share our most recent newsletter of some of our best community journalism https://bit.ly/orourkenewsletter.
Digital Growth: We had a solid year in 2023. Total digital revenue finished +14% vs. prior year and is very profitable. We are +5% YTD-2024. Our internal digital agency has crossed the point where it could stand on its own as a business, which is quite impressive given that we are still at an early stage. It is a total team effort but special recognition to our key players that make it happen—Caleb Anderson (COO), Megan Ivey (Digital Marketing Fulfillment Director), Joe Mathes (VP Digital Strategy & top seller in the company), and Joe Paul (VP Digital).
Key Hires: Jade Lewandowski joined the company as Director of Sales back in February 2023. Jade came to us from the educational publishing and edtech space. She is responsible for the direct management of sales teams in MN, AZ, NM and two of our markets in CO. Chad Richardson joined the company in March 2023 as VP-News. Chad is responsible for managing the team of editors that work in each market. Both have made a really nice impact so far and the best is yet to come.
In this update, I wanted to provide some added details on the acquisitions that we completed in 2023/2024.
The Colorado business is more like three or four individual entities-growth opportunities in Salida and Buena Vista (Chaffee County) look much different than our markets in Leadville and Fairplay. EBITDA performance was solid in 2023, but just a little below what we expected in year one; 2024 is pacing to our full year expectation.
Jeff Wolfe was promoted last year to GM in Chaffee County. Jeff excels with building advertising relationships and has had a calming influence on a business that has really been faced with lots of challenges since the acquisition last April since most of the management team retired or moved. Cailey McDermott joined last May as editor for the Mountain Mail in Salida. Hannah Harn was promoted to editor role for the Chaffee County Times last summer. Product improvement has been outstanding in both markets. Stephanie Wagner was promoted to Publisher of our business in Leadville earlier this year and does a great job with keeping the Herald-Democrat front and center with everything going on in Leadville. She has also done a nice job with driving new digital and niche revenue. Michelle Peters is the revenue lead in Fairplay and is helping us rebuild revenue and our presence in the market. The operations/production team in Salida, which is led by Morris Christensen and Jenny Barton, performs well as we continue to print profitably in house. Morris has been at it for 40+ years and does a remarkable job with maintaining production quality and efficiency. We were lucky to have found and hired Jenny last summer. Kirby and Sherri Miller, who have worked in Salida for 37 years and counting, are key contributors. OMG-CO is positioned for take-off!
In Pagosa Springs, we blew away the 2023 EBITDA expectation and are pacing to deliver strong top and bottom-line results in 2024. Shari Pierce was promoted to Publisher back in March; she previously worked for 20+ years at the SUN in a sales capacity. Shari drives sales just about every day she comes to work, has done an amazing job since last September with transitioning the business into OMG and keeps the SUN in the middle of everything going on in Pagosa Springs. Randi Everett was promoted to Editor soon after our acquisition back in September-the SUN may very well be the best local newspaper in the state of Colorado and is certainly in the top tier within OMG. The key metrics to support my opinion: Paid subscriptions are higher this year than last year with practically no marketing effort. And profit is growing in the market. Christin Flanagan joined back in January and has done a nice job working with Shari and the team to strengthen the office and improve customer service. Robert Penton runs the Production operation, and we love that we still print the SUN in house.
As recently written about, we just welcomed the Times Publishing Newspapers in the Philly burbs into OMG. It is early in the transition, but the first two months have gone exceptionally well. Donna and Mark Allen, the previous owners, have been very helpful and the team we inherited has been awesome! Sally Shepherd and Caleb Anderson have played a nice role with the transition. Super-excited to have recently added Perry Corsetti, who has hit the ground running as our new GM and June Portney, who joined in April as Editor.
About the Company
O’Rourke Media Group is a fast-growing company that owns and operates hyper-local, community newspapers, websites, niche publications and a full-service digital agency. We are family-owned and mission-driven to save newspapers and local media companies by investing in the people, resources and technology needed to thrive for many years to come. We believe that every community can benefit from a well-run, properly resourced, local newspaper and website. Our News teams produce hyper-local, high interest local news and accurate and trustworthy reporting. Our Sales and Digital Fulfillment teams bring omnichannel advertising solutions to local businesses in the communities we serve.
O’Rourke Media Group now operates in nine states and 38 markets with 51 publications and hyper-local websites. We started from ground zero in December 2018, totally bootstrapped, confident and with an entrepreneurial mindset. We plan to continue to expand O’Rourke Media Group into 100+ markets over the next two to three years, then we will take it from there and probably keep going! We do not have any geographic boundaries; we build around people, trusted brands, established advertising relationships and audience (print, digital, newsletter).
If you are a current newspaper owner or operator and have an interest in exploring a sale or managed buyout with us, please feel free to reach out to me directly anytime. Of course, we love engaging with established brokers in the industry and outside of the industry. After lots of learning, I believe that we do a fantastic job with welcoming people and transitioning additional newspapers and businesses into OMG. We are built to scale, but we also maintain a local presence in every one of our markets (you can call our top people on the team to validate this). We have done traditional financing deal structures, but we have also gotten very creative to make things happen in situations where banks are not interested in funding a deal.
If you are interested in working for us, please reach out to Caleb Anderson or myself. We are always on the hunt for talent that can help us grow the business. In many cases, you can help write your own job description.
We would like to again thank everyone on the team for the hard work and dedication to O’Rourke Media Group. Please do not ever hesitate to reach out to us directly with questions, concerns, suggestions, or ideas. Have a wonderful, safe summer!
Sincerely,
Jim & Denise O’Rourke
Email: jorourke@orourkemediagroup.com or Call: 312-995-9452