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The Company
Jason Kaplan, Quinn Chatham, Raphael Ortiz
1
Agenda
I. Executive Summary
II. Company Profile
III. Industry Trends
IV. Valuation
V. Potential Buyers
VI. Social Media Damages
2
I. Executive Summary
3
Executive Summary
Industry Overview
Company Profile
The Company operates in the newspaper publishing and distributing segment, which focuses on the distribution
and publishing of regional and national newspapers.
The Company is a newspaper publishing and distributing company that operates the LA Tribune, a Southern
California regional newspaper.
Valuation
Discounted Cash Flows, Precedent Transactions and Comparable Company Analysis models lead to a valuation
range of $364.11 to $538.93mm.
Potential Buyers
We recommend a strategic buyer for TCO because of the potential synergy opportunities from this sale, and the
premium price. Facebook and Comcast are our potential strategic buyers, because of their current foothold in the
entertainment, media, news and social media industry.
Damages
Total lost operating profit from 2014 to 2016 from advertising and subscriptions was $267.727mm due to the “First
Click Free” policies of Facebook and Google.
4
II. Company Profile
5
Company Profile
Business Description
Print & Digital Subscriptions
The Company (TCO) is a newspaper publishing
company which provides a daily and Sunday newspaper
under the LA tribune and operates the LAtribune.com,
which features full editorial text from the LA Tribune as
well as original text, video content and other interactive
features.
Organizational Structure
Digital
1200
400
650
750
1500
1250
1250
1200
2014
2015
2016
2017*
Financial
Performance
Click
to edit Master
title style
$1,000,000
Revenue
TCO Co.
EBIDTA
Net Income
$950,000
$900,000
$850,000
$800,000
LA Tribune
LAtribune.com
$750,000
$700,000
2014
2015
2016
6
Revenue Breakdown
TCO Co. Revenue Streams
Circulation & Advertising
Weekday
Circulation
$600,000
$500,000
Sunday
$400,000
Digital
$300,000
Total
Revenue
$200,000
Display
Advertising
Digital
Classifieds
$100,000
$2014
2015
2016
2017
Circulation
2018
2019
2020
2021
Advertising
7
SWOT Analysis
Strengths
Weaknesses
• Growing digital subscriptions
• Print subscriptions are declining
• Strong reputation for journalistic excellence
• Decreasing print advertising revenue
• Dominant regional presence in greater Los
Angeles area, but also is the 4th most
circulated newspaper nationwide
• Print production overhead
Opportunities
• Monetizing new digital consumer profiles
• Smart phone user adoption of new digital
media
• Younger generation’s adversity to old forms of
media
Threats
Click to edit
Master title style
• Growing number of competitors in the media
industry
• Tailwinds from recent election cycle
• Social media damages from free article
distribution
• Pivoting to a digitally focused business model
• Top talent going to digital only publishing firms
8
III. Industry Trends
9
TCO Case Final.pdf (PDF, 1.62 MB)
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