GANNETT: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND OPERATING RESULTS (Form 10-Q)

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The following discussion and analysis of our financial condition and results of
operations and quantitative and qualitative disclosures should be read in
conjunction with our unaudited condensed consolidated financial statements and
related notes and with our audited consolidated financial statements included in
our Annual Report on Form 10-K for the year ended December 31, 2020, as filed
with the Securities and Exchange Commission. Management's Discussion and
Analysis of Financial Condition and Results of Operations contains a number of
forward-looking statements that reflect our plans, estimates, and beliefs, all
of which are based on our current expectations and could be affected by certain
uncertainties, risks, and other factors described under Cautionary Note
Regarding Forward-Looking Statements and elsewhere throughout this
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Quarterly Report, as well as the factors described in our Annual Report on Form
10-K for the year ended December 31, 2020, and subsequent periodic reports filed
with the Securities and Exchange Commission, particularly under "Risk Factors."
Our actual results could differ materially from those discussed in the
forward-looking statements.

PREVIEW

We are a subscription-led and digitally-focused media and marketing solutions
company committed to empowering communities to thrive. We aim to be the premier
source for clarity, connections and solutions within our communities. Our
strategy is focused on driving audience growth and engagement by delivering
deeper content experiences to our consumers, while offering the products and
marketing expertise our advertisers desire. The execution of this strategy is
expected to allow us to continue our evolution from a more traditional print
media business to a digitally-focused content platform.

Our current portfolio of media assets includes USA TODAY, local media
organizations in 46 states in the U.S., and Newsquest, a wholly-owned subsidiary
operating in the United Kingdom ("U.K.") with more than 120 local media brands.
We also own the digital marketing services companies ReachLocal, Inc.
("ReachLocal"), UpCurve, Inc. ("UpCurve"), and WordStream, Inc. ("WordStream")
which are marketed under the LOCALiQ brand, and run the largest media-owned
events business in the U.S., USA TODAY NETWORK Ventures.

Through USA TODAY, our local property network, and Newsquest, we deliver
high-quality, trusted content where and when consumers want to engage with it on
virtually any device or platform. Additionally, we have strong relationships
with hundreds of thousands of local and national businesses in both our U.S. and
U.K. markets due to our large local and national sales forces and a robust
advertising and digital marketing solutions product suite.

Trade trends

We took into account several industry trends when evaluating our business strategy:

•Print advertising continues to decline as the audience increasingly moves to
digital platforms. We look to optimize our print operations to efficiently
manage for this declining print audience. We are focused on converting the
growing digital audience into digital-only subscribers to our publications.
•Small and medium-sized businesses ("SMBs") are facing an increasingly complex
marketing environment and need to create digital presence to capture audience
online. We offer a broad suite of DMS products that offer a single, unified
solution to meet their digital marketing needs.
•Consumers are looking for experience-based, emotional connections and
communities. USA TODAY NETWORK Ventures was designed to celebrate local
communities and create opportunities for meaningful in-person and virtual
experiences.
•Digital consumer engagement has declined in comparison to such engagement at
the height of the COVID-19 pandemic in the second quarter of 2020, as consumers
have been able to return to their pre-pandemic routines and have fewer immediate
safety concerns. In addition, the overall news cycle, specifically political
coverage, has also slowed, driving less consumer engagement to our sites.
•Newsprint availability is constrained due to manufacturing facility closures
and conversions to specialty paper and packaging grades. Further, transportation
issues are challenging supplier deliveries.

Some issues affecting comparability

The following will affect period-to-period comparisons beginning in 2020 and will continue to affect period-to-period comparisons for future results:

Reclassifications

Certain amounts in the prior period condensed consolidated financial statements
have been reclassified to conform to the current year presentation. In the
fourth quarter of 2020, we re-aligned the breakout of the Publishing segment's
Circulation revenues related to Digital-only circulation. As a result of this
updated presentation, Print circulation revenues increased and Digital-only
circulation revenues decreased $3.6 million and $7.5 million for the three and
six months ended June 30, 2020, respectively. There was no impact on reported
total Publishing segment or consolidated Circulation revenues.

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2027 Notes

At the Special Meeting of stockholders of the Company held on February 26, 2021
(the "Special Meeting"), our stockholders approved the issuance of the maximum
number of shares of Common Stock issuable upon conversion of the 6.0% Senior
Secured Convertible Notes due 2027 (the "2027 Notes"). As a result, the
conversion option can be share-settled in full and qualified for equity
classification. Upon reclassification, the conversion feature was adjusted to
fair value as of the stockholder approval date and the increase in the fair
value resulted in a non-cash loss of $126.6 million due primarily to an increase
in our stock price from December 31, 2020. The non-cash loss was recorded in
Non-operating expense in the condensed consolidated statements of operations and
comprehensive income (loss) for the six months ended June 30, 2021. As of June
30, 2021, the deferred tax asset related to the embedded conversion feature of
the 2027 Notes was reclassified to Equity as a reduction to Additional
paid-in-capital and reduced the carrying amount of the equity component of the
2027 Notes to $283.7 million.

Integration and reorganization costs

For the three and six months ended June 30, 2021, we incurred Integration and
reorganization costs of $8.4 million and $21.8 million, respectively, including
$1.1 million and $8.2 million, respectively, related to severance activities and
$7.3 million and $13.6 million, respectively, related to other costs, including
those for the purpose of consolidating operations.

For the three and six months ended June 30, 2021, we ceased operations of two
and ten printing operations, respectively, as part of the synergy and ongoing
cost reduction programs. As a result, we recognized accelerated depreciation of
$1.1 million and $10.3 million during the three and six months ended June 30,
2021, respectively.

For the three and six months ended June 30, 2020, we incurred Integration and
reorganization costs of $32.3 million and $60.6 million, respectively, including
$25.7 million and $47.5 million, respectively, related to severance activities
and $6.6 million and $13.0 million, respectively, related to other costs,
including those for the purpose of consolidating operations.

For the three and six months ended June 30, 2020, we ceased operations of ten
and 24 printing operations, respectively, as part of the ongoing cost reduction
programs. As a result, we recognized accelerated depreciation of $11.0 million
and $35.8 million during the three and six months ended June 30, 2020,
respectively.

Good will and intangible depreciation

During the second quarter of 2021, we (i) compared the fair value of each
reporting unit to its carrying amount, which resulted in the fair value of all
the reporting groups being in excess of their carrying values and (ii) compared
the fair value of each indefinite-lived asset to its carrying amount, which
resulted in the fair value of each indefinite-lived asset being in excess of its
carrying value. As such, for the three and six months ended June 30, 2021, we
did not incur any goodwill and intangible impairments in connection with our
annual impairment analysis.

For the three and six months ended June 30, 2020, we incurred goodwill and intangible impairment of $ 393.4 million, primarily due to the impact of the COVID-19 pandemic on our operations.

Foreign currency

Our U.K. publishing operations are conducted through our Newsquest subsidiary.
In addition, our ReachLocal subsidiary has foreign operations in regions such as
Canada, Australia/New Zealand and India. Earnings from operations in foreign
regions are translated into U.S. dollars at average exchange rates prevailing
during the period, and assets and liabilities are translated at exchange rates
in effect at the balance sheet date. Translation fluctuations impact revenue,
expense, and operating income results for international operations.

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Outlook for 2021

Strategy

Our strategic focus areas for 2021 include:

Accelerate the growth of the number of digital subscribers

The broad reach of our newsroom network, linking leading national journalism at
USA TODAY, our local property network in 46 states in the U.S., and Newsquest in
the U.K. with more than 120 local media brands, gives us the ability to deepen
our relationships with consumers at both the national and local levels. We bring
consumers local news and information that impacts their day-to-day lives while
keeping them informed of the national events that impact their country. We
believe this local content is not readily obtainable elsewhere, and we are able
to deliver that content to our customers across multiple print and digital
platforms. As such, a key element of our consumer strategy is growing our paid
digital-only subscriber base to 10 million subscribers over the next five years.
We expect to do this through expansion of our current subscription products as
well as through the launch of new digital subscription offerings tailored to
specific users.

Drive the growth of digital marketing services by engaging more customers in a subscriber relationship

We are now of significant digital scale, with unique reach at both the national
and local community levels. We expect to leverage our integrated sales structure
and lead generation strategy to continue to aggressively expand our digital
marketing services business into our local markets, both domestically and
internationally. Given our extensive client base and volume of digital
campaigns, we will also use data and insights to inform new and dynamic
advertising products that we believe will deliver superior results.

Optimizing our traditional activities in print and advertising

We will continue to drive the profitability of our traditional print operations
through economies of scale, process improvements, and optimizations. We are
focused on optimizing our pricing and improving customer service for our print
subscribers. Print advertising continues to offer a compelling branding
opportunity across our network due to our scale and unique reach at both the
national and local community levels.

Prioritize investments in growth companies that have significant potential and support our vision

By leveraging our unique footprint, trusted brands, and media reach, we
identify, experiment, and invest in potential growth businesses. USA TODAY
NETWORK Ventures is a strong example of one such experiment that has grown
significantly since its founding in 2015. During 2020, USA TODAY NETWORK
Ventures was able to successfully pivot to holding its events virtually, hosting
over 250 events. This success has continued in 2021, with over 90 events held
through the end of the second quarter of 2021. While live events have resumed in
2021, the majority of events remain virtual. In addition, in connection with our
company-wide priority to explore online gaming, in July 2021, we entered into an
exclusive agreement with Tipico USA Technology, Inc. ("Tipico"), a U.S.-based
subsidiary of European-based Tipico Group of Companies, the leading sports
betting provider in Germany, utilizing their Tipico Sportsbook brand.

Impacts of the COVID-19 pandemic

As a result of the COVID-19 pandemic, we experienced a significant decline in
Advertising and marketing services revenues, which accelerated the secular
declines that we continue to experience. We continue to experience constraints
on the sales of single copy newspapers, largely tied to business travel and
in-person events. While we have seen operating trends improve since the second
quarter of 2020, which represents the quarter that was most significantly
impacted by the pandemic, we expect that the COVID-19 pandemic will continue to
have a negative impact on our business and results of operations in the
near-term, including lower revenues associated with in-person events and sales
of single copy newspapers as a result of continued restrictions and reduced
business travel. If the COVID-19 pandemic were to revert to conditions that
existed during 2020, including measures to help mitigate and control the spread
of the virus, we would expect to experience further negative impacts in
Advertising and marketing services revenues.

We have implemented and continue to implement measures to reduce costs and preserve cash flow. These measures include, assessing and applying for all government assistance programs to which we are eligible, including the paycheck

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Protection Program ("PPP"), suspension of the quarterly dividend and refinancing
of our debt, as well as reductions in discretionary spending. In addition, we
are continuing with our previously disclosed plan to monetize non-core assets.

In connection with the CARES Act, we have received $16.4 million in PPP funding
in support of certain of our locations that were meaningfully affected by the
COVID-19 pandemic. As of June 30, 2021, PPP loans of $16.4 million are included
in Other long-term liabilities in the condensed consolidated balance sheets and
in Operating activities in the condensed consolidated statement of cash flows
for the six months ended June 30, 2021. Interest expense related to PPP funding
was immaterial for the three and six months ended June 30, 2021. Management
intends to apply for forgiveness of the PPP loans in accordance with applicable
guidelines.
Seasonality

Our revenues are subject to moderate seasonality, due primarily to fluctuations
in advertising volumes. Advertising and marketing services revenues for our
Publishing segment are typically highest in the fourth quarter, due to holiday
and seasonal advertising, and lowest in the first quarter, following the holiday
season. The volume of advertising sales in any period is also impacted by other
external factors such as competitors' pricing, advertisers' decisions to
increase or decrease their advertising expenditures in response to anticipated
consumer demand, and general economic conditions.

RESULTS OF OPERATIONS

Consolidated summary

A summary of our segment results is presented below:

                                               Three months ended June 30,                                                  Six months ended June 30,
In thousands, except per                                                     Change                                                                        Change
share amounts                  2021               2020                 $                 %                 2021                 2020                  $                %
Operating revenues:
Publishing                 $ 724,545          $  695,893          $  28,652                4  %       $ 1,424,130          $ 1,554,043          $ (129,913)            (8) %
Digital Marketing
Solutions                    110,037              94,563             15,474               16  %           212,318              215,844              (3,526)            (2) %
Corporate and other            1,705               2,398               (693)             (29) %             4,779                5,407                (628)           (12) %
Intersegment eliminations    (32,012)            (25,854)            (6,158)              24  %           (59,868)             (59,611)               (257)             -  %
Total operating revenues     804,275             767,000             37,275                5  %         1,581,359            1,715,683            (134,324)            (8) %
Operating expenses:
Publishing                   654,255           1,045,492           (391,237)             (37) %         1,311,485            1,876,021            (564,536)           (30) %
Digital Marketing
Solutions                    105,035             140,403            (35,368)             (25) %           206,139              263,135             (56,996)           (22) %
Corporate and other           31,552              44,583            (13,031)             (29) %            70,217              103,586             (33,369)           (32) %
Intersegment eliminations    (32,012)            (25,854)            (6,158)              24  %           (59,868)             (59,611)               (257)             -  %
Total operating expenses     758,830           1,204,624           (445,794)             (37) %         1,527,973            2,183,131            (655,158)           (30) %
Operating income (loss)       45,445            (437,624)           483,069                 ***            53,386             (467,448)            520,834               ***
Non-operating expenses,
net                           13,044              34,483            (21,439)             (62) %           172,795               76,286              96,509               ***
Income (loss) before
income taxes                  32,401            (472,107)           504,508                 ***          (119,409)            (543,734)            424,325            (78) %
Provision (benefit) for
income taxes                  17,692             (34,276)            51,968                 ***             8,583              (25,297)             33,880               ***
Net income (loss)             14,709            (437,831)           452,540                 ***          (127,992)            (518,437)            390,445            (75) %
Net loss attributable to
redeemable noncontrolling
interests                       (406)               (938)               532              (57) %              (791)              (1,392)                601            (43) %
Net income (loss)
attributable to Gannett    $  15,115          $ (436,893)         $ 452,008                 ***       $  (127,201)         $  (517,045)         $  389,844            (75) %
Income (loss) per share
attributable to Gannett -
basic                      $    0.11          $    (3.32)         $    3.43                 ***       $     (0.95)         $     (3.95)         $     3.00            (76) %
Income (loss) per share
attributable to Gannett -
diluted                    $    0.10          $    (3.32)         $    3.42                 ***       $     (0.95)         $     (3.95)         $     3.00            (76) %

*** Indicates a percentage change in absolute value greater than 100.

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Intersegment eliminations in the preceding table represent digital advertising
marketing services revenues and expenses associated with products sold by our
U.S. local publishing sales teams but fulfilled by our DMS segment. When
discussing segment results, these revenues and expenses are presented gross but
are eliminated in consolidation.

Operating income

Total Operating revenues were $804.3 million and $1.581 billion for three and
six months ended June 30, 2021, respectively, an increase of $37.3 million and a
decrease of $134.3 million compared to the three and six months ended June 30,
2020, respectively, for the reasons described below.

For the Publishing segment, Operating revenues increased $28.7 million for the
three months ended June 30, 2021 compared to the three months ended June 30,
2020, reflecting higher Advertising and marketing services revenues of $49.2
million, including both print and digital, and higher Other revenues of $11.8
million, partially offset by lower Circulation revenues of $32.4 million. For
the six months ended June 30, 2021, Operating revenues decreased $129.9 million
compared to the six months ended June 30, 2020 due to lower Advertising and
marketing services revenues of $40.1 million, reflecting lower print and higher
digital revenues, lower Circulation revenues of $81.7 million, and lower Other
revenues of $8.1 million. Advertising and marketing services revenues are
generated by the sale of local, national, and classified print advertising
products, digital advertising offerings such as digital classified
advertisements, digital media such as display advertisements run on our
platforms as well as third-party sites, and digital marketing services delivered
by our DMS segment. Circulation revenues are derived from home delivery, digital
distribution and single copy sales of our publications. Other revenues are
derived mainly from commercial printing, distribution arrangements, revenues
from our events business, digital content syndication and affiliate revenues and
third party newsprint sales.

For the DMS segment, Operating revenues increased $15.5 million for the three
months ended June 30, 2021 compared to the three months ended June 30, 2020,
reflecting higher Advertising and marketing services revenues of $20.2 million,
partially offset by lower Other revenues of $4.8 million. For the six months
ended June 30, 2021, Operating revenues decreased $3.5 million compared to the
six months ended June 30, 2020, reflecting higher Advertising and marketing
services revenues of $5.3 million, which were more than offset by lower Other
revenues of $8.8 million. Our DMS segment generates Advertising and marketing
services revenues through multiple services, including search advertising,
display advertising, search optimization, social media, website development, web
presence products, customer relationship management, and software-as-a-service
solutions.

For the Corporate and other category, Operating revenues decreased $0.7 million
and $0.6 million during the three and six months ended June 30, 2021,
respectively, compared to the three and six months ended June 30, 2020. Revenues
at our Corporate and other category are primarily driven by cloud offerings and
software licensing.

Operating expenses

Total Operating expenses were $758.8 million and $1.528 billion for the three
and six months ended June 30, 2021, respectively, a decrease of $445.8 million
and $655.2 million compared to the three and six months ended June 30, 2020,
respectively. Operating expenses consist primarily of the following:

•Operating costs at the Publishing segment include labor, newsprint and delivery
costs and at the DMS segment include the cost of online media acquired from
third parties and costs to manage and operate our marketing solutions and
technology infrastructure;
•Selling, general and administrative expenses include labor, payroll, outside
services, benefits costs and bad debt expense;
•Depreciation and amortization;
•Integration and reorganization costs include severance charges and other costs,
including those for the purpose of consolidating our operations (i.e., facility
consolidation expenses and integration-related costs);
•Other operating expenses include third-party debt expenses as well as
acquisition-related costs;
•Gains or losses on the sale or disposal of assets; and
•Impairment charges, including costs incurred related to goodwill, intangible
assets and property, plant and equipment.

For the three months ended June 30, 2021, Operating expenses at our Publishing
segment decreased $391.2 million compared to the three months ended June 30,
2020, reflecting a decrease in Operating costs of $6.7 million, a decrease in
Depreciation and amortization of $20.1 million, a decrease in Integration and
reorganization costs of $20.8 million, a decrease in Asset impairments of $6.9
million, and a decrease in Goodwill and intangible impairments of $352.9
million, partially offset by an increase in Selling, general and administrative
expenses of $9.9 million and an increase in Loss on the sale or disposal of
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assets of $6.3 million. For the six months ended June 30, 2021, Operating
expenses at our Publishing segment decreased $564.5 million compared to the six
months ended June 30, 2020, reflecting a decrease in Operating costs of $93.8
million, a decrease in Selling, general and administrative expenses of $54.7
million, a decrease in Depreciation and amortization of $40.7 million, a
decrease in Integration and reorganization costs of $26.8 million, a decrease in
Asset impairments of $6.0 million, and a decrease in Goodwill and intangible
impairments of $352.9 million, partially offset by an increase in Loss on the
sale or disposal of assets of $10.4 million.

For the three months ended June 30, 2021, Operating expenses at our DMS segment
decreased $35.4 million compared to the three months ended June 30, 2020,
reflecting a decrease in Goodwill and intangible impairments of $40.5 million, a
decrease in Selling, general and administrative expenses of $6.1 million, a
decrease in Integration and reorganization costs of $2.8 million and a decrease
in Loss on the sale or disposal of assets of $1.0 million, partially offset by
an increase in Operating costs of $11.2 million, and an increase in Depreciation
and amortization of $3.8 million. For the six months ended June 30, 2021,
Operating expenses at our DMS segment decreased $57.0 million compared to the
six months ended June 30, 2020, reflecting a decrease in Goodwill and intangible
impairments of $40.5 million, a decrease in Selling, general and administrative
expenses of $23.0 million, a decrease in Integration and reorganization costs of
$4.0 million and a decrease in Loss on the sale or disposal of assets of $1.1
million, partially offset by an increase in Operating costs of $7.2 million and
an increase in Depreciation and amortization of $4.3 million.

For the three months ended June 30, 2021, Operating expenses at Corporate and
other decreased $13.0 million compared to the three months ended June 30, 2020,
reflecting a decrease in Selling, general and administrative expenses of $9.1
million, a decrease in Depreciation and amortization of $1.8 million, and a
decrease in Other operating expenses of $1.6 million. For the six months ended
June 30, 2021, Operating expenses at Corporate and other decreased $33.4 million
compared to the six months ended June 30, 2020, due to a decrease in Selling,
general and administrative expenses of $24.8 million, a decrease in Integration
and reorganization costs of $7.9 million, a decrease in Depreciation and
amortization of $1.6 million, and a decrease in Operating costs of $1.9 million,
partially offset by an increase in Other operating expenses of $3.0 million.

See the analysis of segment results below for more information.

Non-operating expenses (income)

Interest expense: For the three and six months ended June 30, 2021, Interest
expense was $35.3 million and $74.8 million, respectively, compared to $57.9
million and $115.8 million for the three and six months ended June 30, 2020,
respectively. The decrease in interest expense for the three and six months
ended June 30, 2021 was mainly due to a lower effective interest rate driven by
the refinancing of our five-year, senior-secured 11.5% term loan facility with
Apollo Capital Management, L.P. (the "Acquisition Term Loan") in the first
quarter of 2021 and a lower debt balance compared to the same period in 2020.

Loss on early extinguishment of debt: For the three and six months ended June
30, 2021, Loss on early extinguishment of debt was $2.8 million and
$22.2 million, respectively. For the three and six months ended June 30, 2020,
Loss on early extinguishment of debt was $0.4 million and $1.2 million,
respectively. The increase in loss for the three months ended June 30, 2021 was
mainly due to early prepayments on our five-year, senior-secured term loan
facility (the "5-Year Term Loan"). The increase in loss for the six months ended
June 30, 2021 was mainly due to the payoff of the Acquisition Term Loan in the
first quarter of 2021.

Non-operating pension income: For the three and six months ended June 30, 2021,
Non-operating pension income was $23.9 million and $47.8 million, respectively,
compared to $17.6 million and $36.1 million for the three and six months ended
June 30, 2020, respectively. The increase in non-operating pension income for
the three and six months ended June 30, 2021 was primarily due to an increase in
the expected return on plan assets held by the Gannett Retirement Plan and lower
interest costs on benefit obligations.

Loss on Convertible notes derivative: For the six months ended June 30, 2021,
Loss on Convertible notes derivative was $126.6 million, due to the increase in
the fair value of the derivative liability as a result of the increase in the
Company's stock price.

Provision (benefit) for income taxes

The following table summarizes our loss accounts before income taxes and income taxes:

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Contents

                                           Three months ended June 30,                 Six months ended June 30,
In thousands                                 2021                 2020                  2021                 2020
Income (loss) before income taxes      $     32,401           $ (472,107)         $    (119,409)         $ (543,734)
Provision (benefit) for income taxes         17,692              (34,276)                 8,583             (25,297)
Effective tax rate                             54.6   %              7.3  %                (7.2) %              4.7  %



The provision for income taxes for the three months ended June 30, 2021 was
mainly driven by pre-tax income and is impacted by the creation of valuation
allowances on non-deductible interest expense carryforwards in combination with
the U.K. enacted legislation to increase the statutory tax rate from 19% to 25%,
effective April 1, 2023. While the U.K. corporate tax rate change does not
impact 2021 or 2022 tax filings, the rate change impacts the tax effected value
of the U.K. deferred tax liabilities. The provision was calculated using the
estimated annual effective tax rate of 49.6%. The estimated annual effective tax
rate is based on a projected tax expense for the full year.

The tax provision for the six months ended June 30, 2021 was mainly impacted by
the pre-tax net loss generated during the first quarter of 2021. The tax
provision is mainly impacted by the derivative revaluation, which is
nondeductible for tax purposes, partially offset by the creation of valuation
allowances on non-deductible interest expense carryforwards as well as state
income tax and foreign tax expense.

As of June 30, 2021, we reclassified $32.5 million as tax effected in connection
with the retirement of the deferred tax asset related to the embedded conversion
feature associated with the Company's 2027 Notes. The retirement of the deferred
tax asset resulted from the reclassification of the embedded conversion feature
from a derivative liability to Equity as a reduction to Additional
paid-in-capital during the first quarter of 2021. See Note 7 - Debt for
additional information about the Company's 2027 Notes.

The benefit for income taxes for the three months ended June 30, 2020 was caused
largely by the pre-tax net loss generated during the second quarter of 2020. The
benefit from income taxes was reduced due to non-deductible asset impairments,
non-deductible officers' compensation, and the creation of a valuation allowance
against deferred tax assets arising from non-deductible interest carryforwards.
These non-deductible expenses resulted in an estimated annual effective tax rate
lower than the statutory federal rate of 21%. The benefit for income taxes for
the three months ended June 30, 2020 was calculated using the estimated annual
effective tax rate of 6.8%. The estimated annual effective tax rate is based on
a projected tax benefit for the year.

Several COVID-19 pandemic-related economic relief bills have been enacted into
law in 2020 and 2021. We continue to monitor the applicability of federal and
state legislation to the Company, as well as regulatory interpretations of
enacted legislation that provides economic relief in response to the pandemic
and expect to utilize these provisions as we determine necessary or desirable.

Net income (loss) attributable to Gannett and diluted earnings (loss) per share attributable to Gannett

For the three months ended June 30, 2021, Net income attributable to Gannett and
diluted income per share attributable to Gannett were $15.1 million and $0.10,
respectively, compared to Net loss attributable to Gannett and diluted loss per
share attributable to Gannett of $436.9 million and $3.32 for the three months
ended June 30, 2020, respectively. For the six months ended June 30, 2021, Net
loss attributable to Gannett and diluted loss per share attributable to Gannett
were $127.2 million and $0.95, respectively, compared to $517.0 million and
$3.95 for the six months ended June 30, 2020, respectively. The change for the
three and six months ended June 30, 2021 reflects the various items discussed
above.

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Publishing segment

Below is a summary of our Publishing segment results:

                                                  Three months ended June 30,                                                Six months ended June 30,
                                                                                Change                                                                     Change
In thousands                      2021               2020                 $                 %               2021                2020                 $                 %
Operating revenues:
Advertising and marketing
services                      $ 341,481          $  292,252          $  49,229              17  %       $  655,791          $  695,888          $ (40,097)             (6) %
Circulation                     310,258             342,645            (32,387)             (9) %          635,694             717,365            (81,671)            (11) %
Other                            72,806              60,996             11,810              19  %          132,645             140,790             (8,145)             (6) %
Total operating revenues        724,545             695,893             28,652               4  %        1,424,130           1,554,043           (129,913)             (8) %
Operating expenses:
Operating costs                 426,216             432,920             (6,704)             (2) %          858,017             951,779            (93,762)            (10) %
Selling, general and
administrative expenses         185,930             176,043              9,887               6  %          352,133             406,856            (54,723)            (13) %
Depreciation and amortization    36,416              56,553            (20,137)            (36) %           82,803             123,510            (40,707)            (33) %
Integration and
reorganization costs               (197)             20,619            (20,816)               ***            7,129              33,927            (26,798)            (79) %
Asset impairments                     -               6,859             (6,859)           (100) %              833               6,859             (6,026)            (88) %
Goodwill and intangible
impairments                           -             352,947           (352,947)           (100) %                -             352,947           (352,947)           (100) %
Net (gain) loss on sale or
disposal of assets                5,890                (449)             6,339                ***           10,570                 143             10,427                ***
Total operating expenses        654,255           1,045,492           (391,237)            (37) %        1,311,485           1,876,021           (564,536)            (30) %
Operating income (loss)       $  70,290          $ (349,599)         $ 419,889                ***       $  112,645          $ (321,978)         $ 434,623                ***

*** Indicates a percentage change in absolute value greater than 100.

Operating income

The following table provides the breakout of Operating revenues by category:
                                               Three months ended June 30,                                                Six months ended June 30,
                                                                            Change                                                                       Change
In thousands                    2021               2020                $                %                2021                 2020                  $                %
Local and national print    $ 127,600          $ 117,666          $  9,934               8  %       $   244,999          $   290,836          $  (45,837)           (16) %
Classified print               73,325             70,229             3,096               4  %           149,122              164,678             (15,556)            (9) %
Print advertising             200,925            187,895            13,030               7  %           394,121              455,514             (61,393)           (13) %

Digital media                  94,549             65,314            29,235              45  %           174,106              151,811              22,295             15  %
Digital marketing services     33,221             23,640             9,581              41  %            61,574               54,179               7,395             14  %
Digital classified             12,786             15,403            (2,617)            (17) %            25,990               34,384              (8,394)           (24) %
Digital advertising and
marketing services            140,556            104,357            36,199              35  %           261,670              240,374              21,296              9  %

Advertising and marketing
services                      341,481            292,252            49,229              17  %           655,791              695,888             (40,097)            (6) %

Print circulation             286,252            325,459           (39,207)            (12) %           588,509              684,377             (95,868)           (14) %
Digital-only circulation       24,006             17,186             6,820              40  %            47,185               32,988              14,197             43  %
Circulation                   310,258            342,645           (32,387)             (9) %           635,694              717,365             (81,671)           (11) %

Other                          72,806             60,996            11,810              19  %           132,645              140,790              (8,145)            (6) %

Total operating revenues    $ 724,545          $ 695,893          $ 28,652 
             4  %       $ 1,424,130          $ 1,554,043          $ (129,913)            (8) %



For the three months ended June 30, 2021, Print advertising revenues increased
$13.0 million, mainly due to an improvement in operating trends since the second
quarter of 2020, which was the quarter most significantly impacted by the
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COVID-19 pandemic. For the three months ended June 30, 2021, Local and national
print advertising revenues increased $9.9 million, compared to the three months
ended June 30, 2020, primarily due to higher advertising volumes and an increase
in advertiser inserts. For the three months ended June 30, 2021, Classified
print advertising revenues increased $3.1 million, compared to the three months
ended June 30, 2020, due to increased spend in classified advertisements,
including legal, employment and real estate. For the six months ended June 30,
2021, the overall decline in Print advertising revenues of $61.4 million was
driven by secular industry trends impacting all categories. For the six months
ended June 30, 2021, Local and national print advertising revenues decreased
$45.8 million compared to the six months ended June 30, 2020, due to lower
advertising volume and a decline in advertiser inserts. For the six months ended
June 30, 2021, Classified print advertising revenues decreased $15.6 million
compared to the six months ended June 30, 2020, due to reduced spend in
classified advertisements, including legal, real estate and automotive.

For the three months ended June 30, 2021, Digital advertising and marketing
services revenues increased $36.2 million, due to an increase of $29.2 million
in Digital media revenues, an increase of $9.6 million in Digital marketing
services revenues, and a decrease of $2.6 million in Digital classified
revenues, compared to the three months ended June 30, 2020. For the six months
ended June 30, 2021, Digital advertising and marketing services revenues
increased $21.3 million, due to an increase of $22.3 million in Digital media
revenues across both owned and operated sites as well as third-party sites, an
increase of $7.4 million in Digital marketing services revenues, and a decrease
of $8.4 million Digital classified revenues compared to the six months ended
June 30, 2020. For both the three and six months ended June 30, 2021, the
overall increase in Digital advertising and marketing services revenues was due
to an increase in Digital media spend and Digital marketing services revenues as
well as an improvement in operating trends since the second quarter of 2020,
which was the quarter most significantly impacted by the COVID-19 pandemic. The
increase in Digital media revenues for the three and six months ended June 30,
2021 was driven by a higher mix of premium media sold as well as an overall
increase in rate. The increase in Digital marketing services revenues for the
three and six months ended June 30, 2021 was due to higher client counts and
higher average revenue per customer for digital marketing services sold
primarily as a result of focusing on strategic initiatives across our local
marketing sales force. The decrease in Digital classified revenues for the three
and six months ended June 30, 2021 was due to reductions in spend in automotive,
employment and obituary classified advertisements.

For the three and six months ended June 30, 2021, Print circulation revenues
decreased $39.2 million and $95.9 million, respectively, compared to the three
and six months ended June 30, 2020, driven by a reduction in the volume of home
delivery subscribers and a decline in single copy sales reflecting the overall
secular trends impacting the industry as well as the impact of the COVID-19
pandemic on business travel and overall consumer activity. For the three and six
months ended June 30, 2021, Digital-only circulation revenues increased $6.8
million and $14.2 million, respectively, compared to the three and six months
ended June 30, 2020, driven by an increase of 41% in paid digital-only
subscribers, including those subscribers on introductory subscription offers, to
approximately 1.4 million compared to the prior year as well as a slight
increase in average revenue per customer.

For the three months ended June 30, 2021, Other revenues increased $11.8 million
compared to the three months ended June 30, 2020, primarily due to commercial
print customer retention and growth in local markets, as well as an increase in
digital content syndication volume compared to the second quarter of 2020, which
was the quarter most impacted by the COVID-19 pandemic. For the six months ended
June 30, 2021, Other revenues decreased $8.1 million compared to the six months
ended June 30, 2020, primarily due to a decline in event revenues due to fewer
in-person events during the six months ended June 30, 2021 compared to the same
period in the prior year as a result of the COVID-19 pandemic, as well as
declines in the commercial print and delivery business, driven by secular trends
impacting the industry, partially offset by an increase digital content
syndication volume.

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Operating expenses

For the three and six months ended June 30, 2021, Operating costs decreased $6.7
million and $93.8 million, respectively, compared to the three and six months
ended June 30, 2020. The following table provides the breakout of the decrease
in Operating costs:

                                                        Three months ended June 30,                                              Six months ended June 30,
                                                                                      Change                                                                 Change
In thousands                              2021               2020                $               %               2021               2020                $                %
Newsprint and ink                     $  23,713          $  29,542          $ (5,829)           (20) %       $  51,984          $  69,847          $ (17,863)           (26) %
Distribution                            112,446            100,627            11,819             12  %         208,551            207,579                972              -  %
Compensation and benefits               137,775            144,246            (6,471)            (4) %         284,893            325,354            (40,461)           (12) %
Outside services                         88,918             78,641            10,277             13  %         157,682            164,473             (6,791)            (4) %
Other                                    63,364             79,864           (16,500)           (21) %         154,907            184,526            (29,619)           (16) %
Total operating costs                 $ 426,216          $ 432,920          $ (6,704)            (2) %       $ 858,017          $ 951,779          $ (93,762)           (10) %



For the three and six months ended June 30, 2021, Newsprint and ink costs
decreased $5.8 million and $17.9 million, respectively, compared to the three
and six months ended June 30, 2020, mainly due to lower print circulation driven
by the decline in volume of home delivery and single copy sales, and for the six
months ended June 30, 2021 due to declines in print advertising volumes.

For the three months ended June 30, 2021, Distribution costs increased $11.8
million compared to the three months ended June 30, 2020, primarily driven by an
increase in distribution postage, an increase in costs associated with
distribution employees and contractors related to overtime costs resulting from
labor shortages as well as activity in our commercial print business during the
quarter. For the six months ended June 30, 2021, Distribution costs were
essentially flat compared to the six months ended June 30, 2020 as the increases
for the three months ended June 30, 2021 were offset by the decline in print
circulation and print advertising volumes incurred in the first quarter of 2021.

For the three and six months ended June 30, 2021, Compensation and benefits
costs decreased $6.5 million and $40.5 million, respectively, compared to the
three and six months ended June 30, 2020, due to the benefit in 2021 of cost
containment initiatives implemented in the second half of 2020 in connection
with the COVID-19 pandemic, as well as a reduction in costs associated with
ongoing integration efforts, including headcount reductions, offset by the
absence of the temporary reduction of expenses in the prior year, such as
furloughs and wage reductions in response to the COVID-19 pandemic.

For the three months ended June 30, 2021, Outside services costs, which includes
outside printing, professional services fulfilled by third parties, paid search
and ad serving, feature services, and credit card fees, increased $10.3 million
compared to the three months ended June 30, 2020, due to higher costs associated
with the increase in Digital media and Digital marketing services revenues,
including paid search fees and affiliate revenue share as well as other related
costs, offset by the benefits in 2021 of cost containment initiatives
implemented in the second half of 2020 in connection with the COVID-19 pandemic
and a reduction in costs associated with ongoing integration efforts. For the
six months ended June 30, 2021, Outside services costs decreased $6.8 million
compared to the six months ended June 30, 2020, due to the benefit in 2021 of
cost containment initiatives implemented in the second half of 2020 in
connection with the COVID-19 pandemic and a reduction in costs associated with
ongoing integration efforts, offset by higher costs associated with the increase
in Digital media and Digital marketing services revenues, including paid search
fees and affiliate revenue share as well as other related costs.

For the three and six months ended June 30, 2021, Other costs, which primarily
includes travel, and facility and equipment costs, decreased $16.5 million and
$29.6 million, respectively, compared to the three and six months ended June 30,
2020, due to a reduction in costs associated with ongoing integration efforts
and cost containment initiatives.

For the three and six months ended June 30, 2021, Selling, general and administrative expenses increased $ 9.9 million and decreased $ 54.7 million, respectively, compared to the three and six months ended June 30, 2020. The following table shows the breakdown of the reduction in selling, general and administrative expenses:

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                                               Three months ended June 30,                                              Six months ended June 30,
                                                                             Change                                                                 Change
In thousands                     2021               2020                $               %               2021               2020                $                %
Compensation and benefits    $ 100,403          $  88,423          $ 11,980             14  %       $ 190,113          $ 201,950          $ (11,837)            (6) %
Outside services and other      85,527             87,620            (2,093)            (2) %         162,020            204,906            (42,886)           (21) %
Total Selling, general and
administrative expenses      $ 185,930          $ 176,043          $  9,887
             6  %       $ 352,133          $ 406,856          $ (54,723)           (13) %



For the three months ended June 30, 2021, Compensation and benefits costs
increased $12.0 million compared to the three months ended June 30, 2020, due to
the negative impact of higher commission expenses driven by the growth in
Advertising and marketing services revenues as well as a difficult comparison to
the second quarter of 2020 due to the temporary reduction of expenses in the
prior year quarter, such as furloughs and wage reductions, related to cost
containment initiatives driven by the COVID-19 pandemic. For the six months
ended June 30, 2021, Compensation and benefits costs decreased $11.8 million
compared to the six months ended June 30, 2020, due to the benefit in 2021 of
cost containment initiatives implemented in the second half of 2020 in
connection with the COVID-19 pandemic, as well as a reduction in costs
associated with ongoing integration efforts, including headcount reductions,
partially offset by the negative impact of higher payroll and commission
expenses driven by the growth in Advertising and marketing services revenues and
the absence of the temporary reduction of expenses in the prior year, such as
furloughs and wage reductions.

For the three and six months ended June 30, 2021, Outside services and other
costs, which includes services fulfilled by third parties, decreased $2.1
million and $42.9 million, respectively, compared to the three and six months
ended June 30, 2020, due to lower facility related costs, lower bad debt expense
and the benefit in 2021 of cost containment initiatives implemented in the
second half of 2020 in connection with the COVID-19 pandemic.

For the three and six months ended June 30, 2021, Depreciation and amortization
expenses decreased $20.1 million and $40.7 million, respectively, compared to
the three and six months ended June 30, 2020, due to a decrease in accelerated
depreciation of $9.9 million and $25.5 million, respectively, as a result of
fewer print facility shutdowns and strategic dispositions of real estate during
the period related to ongoing cost reduction programs.

For the three and six months ended June 30, 2021, Integration and reorganization
costs decreased $20.8 million and $26.8 million, respectively, compared to the
three and six months ended June 30, 2020 due to a decrease in severance costs of
$17.7 million and $23.2 million, respectively, as well as a decrease in other
costs, including those for the consolidation of operations of $3.1 million and
$3.6 million, respectively. For the three and six months ended June 30, 2021,
severance costs were primarily related to facility consolidation activities. For
the three and six months ended June 30, 2020, severance costs were related to
acquisition-related synergies and the consolidation of the business due to our
acquisition of Gannett Co., Inc. (which was renamed Gannett Media Corp. and is
referred to as "Legacy Gannett") in the fourth quarter of 2019.

For the three and six months ended June 30, 2021, we did not incur any goodwill
and intangible impairments. For the three and six months ended June 30, 2020, we
recorded a goodwill and intangible impairment charge of $352.9 million at the
Publishing segment, primarily due to the impact of the COVID-19 pandemic on our
operations.

For the three and six months ended June 30, 2021, Loss on the sale or disposal
of assets increased $6.3 million and $10.4 million, respectively, compared to
the three and six months ended June 30, 2020, driven by the sale of assets in
2021 as part of our plan to monetize non-core assets.
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Publishing segment Adjusted EBITDA

                                                  Three months ended June 30,                                                  Six months ended June 30,
                                                                                Change                                                                      Change
In thousands                     2021               2020                 $                  %                2021               2020                 $                  %

Net income (loss) attributable to Gannett $ 96,431 $ (328,207) $ 424,638

                  ***       $ 162,655          $ (281,213)         $ 443,868                  ***
Interest expense                     -                     92             (92)             (100) %               -                 110               (110)             (100) %

Non-operating pension income   (23,906)              (17,480)          (6,426)               37  %         (47,784)            (35,953)           (11,831)               33  %
Other non-operating income,
net                             (1,829)             (3,066)             1,237               (40) %          (1,435)             (3,530)             2,095               (59) %
Depreciation and
amortization                    36,416              56,553            (20,137)              (36) %          82,803             123,510            (40,707)              (33) %
Integration and
reorganization costs              (197)             20,619            (20,816)                 ***           7,129              33,927            (26,798)              (79) %
Asset impairments                    -               6,859             (6,859)             (100) %             833               6,859             (6,026)              (88) %
Goodwill and intangible
impairments                          -             352,947           (352,947)             (100) %               -             352,947           (352,947)             (100) %
Net (gain) loss on sale or
disposal of assets               5,890                (449)             6,339                  ***          10,570                 143             10,427                  ***
Other items                      1,384               4,123             (2,739)              (66) %           1,626               6,214             (4,588)              (74) %
Adjusted EBITDA (non-GAAP
basis)                       $ 114,189          $   91,991          $  22,198                24  %       $ 216,397          $  203,014          $  13,383                 7  %
Net income (loss)
attributable to Gannett
margin                            13.3  %            (47.2) %                                                 11.4  %            (18.1) %
Adjusted EBITDA margin
(non-GAAP basis)(a)               15.8  %             13.2  %                                                 15.2  %             13.1  %


*** Indicates an absolute percentage change greater than 100. (a) We define Adjusted EBITDA margin as Adjusted EBITDA divided by total operating income.

Adjusted EBITDA for our Publishing segment was $114.2 million and $216.4 million
for the three and six months ended June 30, 2021, respectively, an increase of
$22.2 million and $13.4 million compared to the three and six months ended June
30, 2020, respectively. The increase for the three and six months ended June 30,
2021 was primarily attributable to the changes discussed above.

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Digital Marketing Solutions segment

A summary of our Digital Marketing Solutions segment results is presented below:
                                                Three months ended June 30,                                             Six months ended June 30,
                                                                             Change                                                                  Change
In thousands                     2021               2020                $                %               2021               2020                $               %
Operating revenues:
Advertising and marketing
services                     $ 110,037          $  89,809          $ 20,228              23  %       $ 211,413          $ 206,092          $  5,321              3  %
Other                                -              4,754            (4,754)           (100) %             905              9,752            (8,847)           (91) %
Total operating revenues       110,037             94,563            15,474
             16  %         212,318            215,844            (3,526)            (2) %
Operating expenses:
Operating costs                 74,429             63,264            11,165              18  %         143,707            136,519             7,188              5  %
Selling, general and
administrative expenses         23,079             29,158            (6,079)            (21) %          46,910             69,892           (22,982)           (33) %
Depreciation and
amortization                     7,850              4,004             3,846              96  %          15,679             11,335             4,344             38  %
Integration and
reorganization costs               204              2,962            (2,758)            (93) %             370              4,351            (3,981)           (91) %

Goodwill and intangible
impairments                          -             40,499           (40,499)               ***               -             40,499           (40,499)              ***
Net (gain) loss on sale or
disposal of assets                (527)               516            (1,043)               ***            (527)               539            (1,066)              ***
Total operating expenses       105,035            140,403           (35,368)            (25) %         206,139            263,135           (56,996)           (22) %

Operating profit (loss) $ 5,002 $ (45,840) $ 50,842

                ***       $   6,179          $ (47,291)         $ 53,470     

***

*** Indicates a percentage change in absolute value greater than 100.

Operating income

For the three and six months ended June 30, 2021, Advertising and marketing
services revenues increased $20.2 million and $5.3 million compared to the three
and six months ended June 30, 2020. The increase for the three months ended June
30, 2021 was primarily driven by growth in the core ReachLocal business and an
improvement in operating trends since the second quarter of 2020, which was the
quarter most significantly impacted by the COVID-19 pandemic. The increase for
the six months ended June 30, 2021 was primarily due to growth in the core
ReachLocal business, partially offset by the absence of $10.4 million of
revenues in 2021 as a result of the change in media rebate programs, as well as
the absence of revenues associated with a business we divested in the third
quarter of 2020.

For the three and six months ended June 30, 2021, Other revenues decreased $4.8
million and $8.8 million, respectively, compared to the three and six months
ended June 30, 2020, primarily due to the absence of revenues related to systems
integration services associated with a business we divested in the fourth
quarter of 2020.

Operating Expenses

For the three and six months ended June 30, 2021, Operating costs increased
$11.2 million and $7.2 million, respectively, compared to the three and six
months ended June 30, 2020. The following table provides the breakout of
Operating costs:

                                                        Three months ended June 30,                                             Six months ended June 30,
                                                                                      Change                                                                 Change
In thousands                              2021               2020                $               %               2021               2020                $               %
Compensation and benefits             $    7,680          $ 10,594          $ (2,914)           (28) %       $  15,815          $  24,223          $ (8,408)           (35) %
Outside services                          64,400            48,927            15,473             32  %         123,091            103,934            19,157             18  %
Other                                      2,349             3,743            (1,394)           (37) %           4,801              8,362            (3,561)           (43) %
Total operating costs                 $   74,429          $ 63,264          $ 11,165             18  %       $ 143,707          $ 136,519          $  7,188              5  %



For the three and six months ended June 30, 2021, Compensation and benefits
costs decreased $2.9 million and $8.4 million, respectively, compared to the
three and six months ended June 30, 2020, due to the benefit in 2021 of cost
containment initiatives implemented in the second half of 2020 in connection
with the COVID-19 pandemic, as well as a reduction in costs
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associated with ongoing integration efforts, including headcount reductions,
offset by the absence of the temporary reduction of expenses in the prior year,
such as furloughs and wage reductions.

For the three and six months ended June 30, 2021, Outside services costs, which
includes professional services fulfilled by third parties, media fees and other
digital costs, increased $15.5 million and $19.2 million, respectively, compared
to the three and six months ended June 30, 2020, due to an increase in expenses
associated with third-party media fees driven by an increase in corresponding
revenue.

For the three and six months ended June 30, 2021, Selling, general and
administrative expenses decreased $6.1 million and $23.0 million, respectively,
compared to the three and six months ended June 30, 2020. The following table
provides the breakout of the decrease in Selling, general and administrative
expenses by category:

                                               Three months ended June 30,                                             Six months ended June 30,
                                                                            Change                                                                Change
In thousands                     2021              2020                $                %              2021              2020                $                %
Compensation and benefits    $  17,175          $ 27,947          $ (10,772)           (39) %       $ 35,237          $ 63,720          $ (28,483)           (45) %
Outside services and other       5,904             1,211              4,693               ***         11,673             6,172              5,501             89  %
Total Selling, general and
administrative expenses      $  23,079          $ 29,158          $  (6,079)           (21) %       $ 46,910          $ 69,892          $ (22,982)           (33) %

*** Indicates a percentage change in absolute value greater than 100.

For the three and six months ended June 30, 2021, Compensation and benefits
costs decreased $10.8 million and $28.5 million, respectively, compared to the
three and six months ended June 30, 2020, due to the benefit in 2021 of cost
containment initiatives implemented in the second half of 2020 in connection
with the COVID-19 pandemic, as well as a reduction in costs associated with
ongoing integration efforts, including headcount reductions, offset by the
absence of the temporary reduction of expenses in the prior year, such as
furloughs and wage reductions.

For the three and six months ended June 30, 2021, Outside services and other
costs increased $4.7 million and $5.5 million, respectively, compared to the
three and six months ended June 30, 2020, due to an increase in various
miscellaneous expenses.

For the three and six months ended June 30, 2021, Integration and reorganization
costs decreased $2.8 million and $4.0 million, respectively, compared to the
three and six months ended June 30, 2020 due to lower severance costs of $2.8
million and $4.2 million, respectively. For the three and six months ended June
30, 2020, severance costs were related to acquisition-related synergies and the
consolidation of the business due to our acquisition of Legacy Gannett in the
fourth quarter of 2019.

For the three and six months ended June 30, 2021, we did not incur any goodwill
and intangible impairments. For the three and six months ended June 30, 2020, we
recorded a goodwill and intangible impairment charge of $40.5 million at the DMS
segment, primarily due to the impact of the COVID-19 pandemic on our operations.
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Digital Marketing Solutions segment Adjusted EBITDA

                                                Three months ended June 30,                                              Six months ended June 30,
                                                                             Change                                                                  Change
In thousands                    2021               2020                $                %               2021               2020                $                %
Net income (loss)
attributable to Gannett      $  4,904          $ (43,226)         $ 48,130                 ***       $  5,985          $ (48,301)         $ 54,286                 ***
Other non-operating expense
(income), net                      98             (2,614)            2,712                 ***            194              1,010              (816)             (81) %
Depreciation and
amortization                    7,850              4,004             3,846               96  %         15,679             11,335             4,344               38  %
Integration and
reorganization costs              204              2,962            (2,758)             (93) %            370              4,351            (3,981)             (91) %
Goodwill and intangible
impairments                         -             40,499           (40,499)                ***              -             40,499           (40,499)                ***
Net (gain) loss on sale or
disposal of assets               (527)               516            (1,043)                ***           (527)               539            (1,066)                ***
Other items                         -                643              (643)                ***              -              1,235            (1,235)                ***
Adjusted EBITDA (non-GAAP
basis)                       $ 12,529          $   2,784          $  9,745                 ***       $ 21,701          $  10,668          $ 11,033                 ***
Net income (loss)
attributable to Gannett
margin                            4.5  %           (45.7) %                                               2.8  %           (22.4) %
Adjusted EBITDA margin
(non-GAAP basis)(a)              11.4  %             2.9  %                                              10.2  %             4.9  %

*** Indicates an absolute percentage change greater than 100. (a) We define Adjusted EBITDA margin as Adjusted EBITDA divided by total operating income.

Adjusted EBITDA for our Digital Marketing Solutions segment was $12.5 million
and $21.7 million for the three and six months ended June 30, 2021,
respectively, compared to $2.8 million and $10.7 million in three and six months
ended June 30, 2020, respectively, primarily attributable to the changes
discussed above.

Company and other category

For the three months ended June 30, 2021, Corporate and other operating revenues
were $1.7 million compared to $2.4 million for the three months ended June 30,
2020. For the six months ended June 30, 2021, Corporate and other operating
revenues were $4.8 million compared to $5.4 million for the six months ended
June 30, 2020.

For the three and six months ended June 30, 2021, Corporate and other operating
expenses decreased $13.0 million and $33.4 million, respectively, compared to
the three and six months ended June 30, 2020. The following table provides the
breakout of the decrease in Corporate and Other operating expenses:

                                                Three months ended June 30,                                             Six months ended June 30,
                                                                             Change                                                                 Change
In thousands                      2021              2020                $                %              2021               2020                $                %
Operating expenses:
Operating costs               $   4,539          $  4,691          $    (152)            (3) %       $  8,495          $  10,439          $  (1,944)           (19) %
Selling, general and
administrative expenses          13,895            22,997             (9,102)           (40) %         28,164             52,947            (24,783)           (47) %
Depreciation and amortization     3,976             5,770             (1,794)           (31) %          7,863              9,507             (1,644)           (17) %
Integration and
reorganization costs              8,437             8,725               (288)            (3) %         14,349             22,282             (7,933)           (36) %
Other operating expenses            774             2,379             (1,605)           (67) %         11,350              8,348              3,002             36  %

Net (gain) loss on sale or
disposal of assets                  (69)               21                (90)              ***             (4)                63                (67)              ***
Total operating expenses      $  31,552          $ 44,583          $ (13,031)           (29) %       $ 70,217          $ 103,586          $ (33,369)           (32) %

*** Indicates a percentage change in absolute value greater than 100.

For the three months ended June 30, 2021, Corporate and other operating expenses
decreased $13.0 million compared to the three months ended June 30, 2020 due to
a decrease in Selling, general and administrative expenses of $9.1 million,
mainly consisting of cost containment initiatives, offset by the absence of the
temporary reduction of expenses in the prior year, such as
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furloughs and wage reductions, a decrease in Depreciation and amortization of
$1.8 million, and a decrease in Other operating expenses of $1.6 million, which
was primarily due to $0.7 million of third-party fees related to the 5-Year Term
Loan (defined below) expensed during the three months ended June 30, 2021
compared to $2.4 million of Acquisition costs incurred during the three months
ended June 30, 2020.

For the six months ended June 30, 2021, Corporate and other operating expenses
decreased $33.4 million due to a decrease in Selling, general and administrative
expenses of $24.8 million, mainly consisting of cost containment initiatives,
offset by the absence of the temporary reduction of expenses in the prior year,
such as furloughs and wage reductions, a decrease in Integration and
reorganization costs of $7.9 million, driven by a decrease in severance of $11.8
million, offset by an increase of $3.9 million in costs associated with systems
implementation and outsourcing of corporate functions. These decreases were
offset by an increase in Other operating expenses of $3.0 million, which was
primarily due to $10.9 million of third-party fees related to the 5-Year Term
Loan expensed during the six months ended June 30, 2021 compared to $8.3 million
of Acquisition costs incurred during the six months ended June 30, 2020.

LIQUIDITY AND CAPITAL RESOURCES

Our primary cash requirements are for working capital, debt securities and capital expenditures.

We expect to fund our operations through cash provided by operating activities.
We expect we will have adequate capital resources and liquidity to meet our
ongoing working capital needs, borrowing obligations, and all required capital
expenditures.

Details of our cash flow are included in the table below:

                                                                   Six months ended June 30,
In thousands                                                       2021                   2020
Net cash provided by operating activities                    $       92,587          $    24,640
Net cash provided by (used for) investing activities                  7,185               (3,026)
Net cash used for financing activities                             (120,979)             (20,331)
Effect of currency exchange rate change on cash                         625                 (780)
(Decrease) increase in cash, cash equivalents and restricted
cash                                                         $      (20,582)         $       503



Cash flows provided by operating activities: Our largest source of cash provided
by our operations is Advertising revenues primarily generated from Local and
national advertising and marketing services revenues (retail, classified, and
online). Additionally, we generate cash through circulation subscribers,
commercial printing and delivery services to third parties, and events. Our
primary uses of cash from our operating activities include compensation,
newsprint, delivery, and outside services.

Our net cash flow provided by operating activities was $92.6 million for the six
months ended June 30, 2021, compared to net cash provided by operating
activities of $24.6 million for the six months ended June 30, 2020. The increase
in net cash flow provided by operating activities was primarily due to a
decrease in interest paid on debt of $75.4 million, a decrease in severance
payments of $22.1 million, $16.4 million in PPP funding received in support of
certain of our locations that were meaningfully affected by the COVID-19
pandemic and an increase in tax refunds of $7.0 million. These increases were
partially offset by a decrease in working capital of $30.0 million due to the
overall timing of payments, including accrued compensation and accounts
receivable collections, and an increase in contributions to our pension and
other postretirement benefit plans of $16.8 million.

Cash flows provided by (used for) investing activities: Cash flows provided by
investing activities totaled $7.2 million for the six months ended June 30, 2021
compared to $3.0 million used for investing activities in the six months ended
June 30, 2020. This increase was primarily due to a decrease in purchases of
property, plant and equipment of $6.3 million and an increase in proceeds from
the sale of real estate and other assets of $5.5 million.

Cash flows used for financing activities: The cash flows used for financing activities total $ 121.0 million for the six months ended June 30, 2021
compared to $ 20.3 million for the six months ended June 30, 2020. This increase is mainly attributable to an increase in net term loan repayments of
$ 65.6 million and payments of debt issuance costs of $ 33.9 million.

Senior secured 5-year term loan

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On February 9, 2021, we entered into a five-year, senior-secured term loan
facility with the lenders from time to time party thereto and Citibank, N.A., as
collateral agent and administrative agent for the lenders, in an aggregate
principal amount of $1.045 billion (the "5-Year Term Loan"). The 5-Year Term
Loan matures on February 9, 2026 and, at the Company's option, bears interest at
the rate of the London Interbank Offered Rate plus a margin equal to 7.00% per
annum or an alternate base rate plus a margin equal to 6.00% per annum.
Accordingly, we are required to dedicate a substantial portion of cash flow from
operations to fund interest payments. Interest on the 5-Year Term Loan is
payable every three months in arrears, beginning in May 2021.

The proceeds of the 5-year term loan were used to repay the remaining principal balance and accrued interest of $ 1.043 billion and $ 13.3 million, respectively, on the acquisition term loan (the “repayment”) and to pay the fees and expenses incurred in obtaining the 5-year term loan.

There were certain lenders that participated in both the Acquisition Term Loan
and the new 5-Year Term Loan and their balances in the Acquisition Term Loan
were deemed to be modified. The Company will continue to defer, over the new
term, the deferred financing fees and original issue discount from the
Acquisition Term Loan of $1.5 million and $34.7 million, respectively, related
to those lenders. Further, certain lenders in the Acquisition Term Loan did not
participate in the new 5-Year Term Loan and their balances in the Acquisition
Term Loan were deemed to be extinguished. As a result, the Company recognized a
Loss on early extinguishment of debt of $17.2 million as a result of the
write-off of the remaining original issue discount and deferred financing fees
related to those lenders. Third party fees of approximately $13.0 million were
allocated to the new lenders in the 5-Year Term Loan on a pro-rata basis, and
$20.9 million of original issue discount were capitalized and will be amortized
over the term of the 5-Year Term Loan using the effective interest method. Third
party fees of $0.7 million and $10.9 million, which were allocated to the
lenders whose balances were deemed to be modified, were expensed and recorded in
Other operating expenses in the condensed consolidated statements of operations
and comprehensive income (loss) for the three and six months ended June 30,
2021, respectively.

The 5-Year Term Loan will amortize in equal quarterly installments at a rate of
10% per annum (or, if the ratio of Total Indebtedness secured on an equal
priority basis with the 5-Year Term Loan (net of Unrestricted Cash) to
Consolidated EBITDA (as such terms are defined in the 5-Year Term Loan) is equal
to or less than a specified ratio, 5% per annum) (the "Quarterly Amortization
Installment"), beginning September 30, 2021. In addition, we will be required to
repay the 5-Year Term Loan from time to time with (i) the proceeds of
non-ordinary course asset sales and casualty and condemnation events, (ii) the
proceeds of indebtedness that is not otherwise permitted under the 5-Year Term
Loan and (iii) the aggregate amount of cash and cash equivalents on hand in
excess of $100 million at the end of each fiscal year. The 5-Year Term Loan is
subject to a requirement to have minimum unrestricted cash of $30 million as of
the last day of each fiscal quarter. As of June 30, 2021, we were in compliance
with all of the covenants and obligations under the 5-Year Term Loan.

From June 30, 2021, we have had $ 990.5 million in total capital outstanding under the 5-year term loan with an effective interest rate of 9.5%.

Under the 5-Year Term Loan, the Company is contractually obligated to make
prepayments with the proceeds from asset sales and may elect to make optional
payments with excess free cash flow from operations. For the three and six
months ended June 30, 2021, we made prepayments totaling $45.8 million and $54.5
million, respectively, which were classified as financing activities in the
condensed consolidated statements of cash flows. These amounts are inclusive of
both mandatory and optional prepayments.

Senior covered convertible bonds due 2027

On November 17, 2020, the Company entered into an Exchange Agreement with
certain of the lenders (the "Exchanging Lenders") under the Acquisition Term
Loan pursuant to which the Company and the Exchanging Lenders agreed to exchange
$497.1 million in aggregate principal amount of the Company's newly issued 6.0%
Senior Secured Convertible Notes due 2027 (the "2027 Notes") for the retirement
of an equal amount of term loans under the Acquisition Term Loan (the
"Exchange"). The 2027 Notes were issued pursuant to an Indenture (the
"Indenture") dated as of November 17, 2020, between the Company and U.S. Bank
National Association, as trustee. The Indenture, as supplemented by the Second
Supplemental Indenture, includes affirmative and negative covenants that are
substantially consistent with the 5-Year Term Loan, as well as customary events
of default.

In connection with the Exchange, the Company entered into an Investor Agreement
with the holders of the 2027 Notes (the "Holders") establishing certain terms
and conditions concerning the rights and restrictions on the Holders with
respect to the Holders' ownership of the 2027 Notes.

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Interest on the 2027 Notes is payable semi-annually in arrears. The 2027 Notes
mature on December 1, 2027, unless earlier repurchased or converted. The 2027
Notes may be converted at any time by the holders into cash, shares of the
Company's Common Stock or any combination of cash and Common Stock, at the
Company's election. The initial conversion rate is 200 shares of Common Stock
per $1,000 principal amount of the 2027 Notes, which is equal to a conversion
price of $5.00 per share of Common Stock (the "Conversion Price").

The conversion rate is subject to customary adjustment provisions as provided in
the Indenture. In addition, the conversion rate will be subject to adjustment in
the event of any issuance or sale of Common Stock (or securities convertible
into Common Stock) at a price equal to or less than the Conversion Price in
order to ensure that following such issuance or sale, the 2027 Notes would be
convertible into approximately 42% of the Common Stock after giving effect to
such issuance or sale assuming the initial principal amount of the 2027 Notes
remains outstanding.

Upon the occurrence of a "Make-Whole Fundamental Change" (as defined in the
Indenture), the Company will in certain circumstances increase the conversion
rate for a specified period of time. If a "Fundamental Change" (as defined in
the Indenture) occurs, the Company will be required to offer to repurchase the
2027 Notes at a repurchase price of 110% of the principal amount thereof.

Holders of the 2027 Notes will have the right to put up to approximately $100
million of the 2027 Notes at par on or after the date that is 91 days after the
maturity date of the 5-Year Term Loan.

Under the Indenture, the Company can only pay cash dividends up to an
agreed-upon amount, provided the ratio of consolidated debt to EBITDA (as such
terms are defined in the Indenture) does not exceed a specified ratio. In
addition, the Indenture provides that, at any time that the Company's Total
Gross Leverage Ratio (as defined in the Indenture) exceeds 1.5 and the Company
approves the declaration of a dividend, the Company must offer to purchase a
principal amount of 2027 Notes equal to the proposed amount of the dividend.

Until the four-year anniversary of the issuance date, the Company will have the
right to redeem for cash up to approximately $99.4 million of the 2027 Notes at
a redemption price of 130% of the principal amount thereof, with such amount
reduced ratably by any principal amount of 2027 Notes that has been converted by
the holders or redeemed or purchased by the Company.

The 2027 Notes are guaranteed by Gannett Holdings LLC and any subsidiaries of
the Company (collectively, the "Guarantors") that guarantee the 5-Year Term
Loan. The Notes are secured by the same collateral securing the 5-Year Term
Loan. The 2027 Notes rank as senior secured debt of the Company and are secured
by a second priority lien on the same collateral package securing the
indebtedness incurred in connection with the 5-Year Term Loan.

For the six months ended June 30, 2021, no shares were issued upon conversion,
exercise, or satisfaction of the required conditions. Refer to Note 10 -
Supplemental equity information to the condensed consolidated financial
statements for details on the convertible debt's impact to diluted earnings per
share under the if-converted method.

Senior convertible bonds maturing in 2024

The $3.3 million principal value of the remaining 4.75% convertible senior notes
due 2024 (the "2024 Notes") outstanding is reported as convertible debt in the
condensed consolidated balance sheets. The effective interest rate on the 2024
Notes was 6.05% as of June 30, 2021.

Further information

We continue to evaluate our results of operations, liquidity and cash flows, and
as part of these measures, we have taken steps to manage cash outflow by
rationalizing expenses and implementing various cost containment initiatives.
The Company does not presently pay a quarterly dividend and has no current
intention to reinstate the dividend. In addition, the terms of our indebtedness,
including our credit facility, the 5-Year Term Loan, and the Indenture for the
2027 Notes have terms that restrict our ability to pay dividends.

The CARES Act, enacted March 27, 2020, provided various forms of relief to
companies impacted by the COVID-19 pandemic. As part of the relief available
under the CARES Act, we deferred remittance of our 2020 Federal Insurance
Contributions Act taxes as allowed by the legislation. The Company was able to
defer $41.6 million of the employer portion of FICA taxes for payroll paid
between March 27, 2020 and December 31, 2020. The Company will have until
December 31, 2021, to pay 50% of the FICA deferral with the remaining 50% to be
remitted on or before December 31, 2022.
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Contents

For the Gannett pension plan in the we, we postponed our contractual contribution and negotiated a payment plan for the $ 5.0 million per quarter up to September 30, 2022.

We expect our capital expenditures for the remainder of 2021 to total
approximately $24.1 million. These capital expenditures are anticipated to be
primarily comprised of projects related to digital product development, costs
associated with our print and technology systems, and system upgrades.

Our leverage may adversely affect our business and financial performance and
restricts our operating flexibility. The level of our indebtedness and our
ongoing cash flow requirements may expose us to a risk that a substantial
decrease in operating cash flows due to, among other things, continued or
additional adverse economic developments or adverse developments in our
business, could make it difficult for us to meet the financial and operating
covenants contained in our 5-Year Term Loan. In addition, our leverage may limit
cash flow available for general corporate purposes such as capital expenditures
and our flexibility to react to competitive, technological, and other changes in
our industry and economic conditions generally.

While we currently anticipate sufficient liquidity, a resurgence of the COVID-19 pandemic and related countermeasures could have a material negative impact on our liquidity and our ability to meet our outstanding obligations, including obligations under the 5 year term loan. The Company continues to closely monitor the COVID-19 pandemic and will continue to take the necessary steps to appropriately manage cash flow.

CRITICAL ACCOUNTING POLICIES AND USE OF ESTIMATES

See our most recent Annual Report on   Form 10-K for the fiscal year ended
December 31, 2020   for a discussion of our critical accounting policies and use
of estimates. There have been no material changes to our critical accounting
policies and use of estimates discussed in such report.

NON-GAAP FINANCIAL MEASURES

A non-GAAP financial measure is generally defined as a measure that aims to measure historical or future financial performance, financial position or cash flows, but excludes or includes amounts that would not be so excluded or included in the measure. the most comparable. we GAAP measure.

Adjusted EBITDA, Adjusted EBITDA margin, and Adjusted Net income (loss)
attributable to Gannett are non-GAAP financial measures we believe offer a
useful view of the overall operation of our businesses and may be different than
similarly-titled measures used by other companies. We define Adjusted EBITDA as
Net income (loss) attributable to Gannett before (1) Income tax expense
(benefit), (2) Interest expense, (3) Gains or losses on the early extinguishment
of debt, (4) Non-operating pension income (expense), (5) Loss on Convertible
notes derivative, (6) Other non-operating items, including equity income, (7)
Depreciation and amortization, (8) Integration and reorganization costs, (9)
Asset impairments, (10) Goodwill and intangible impairments, (11) Gains or
losses on the sale or disposal of assets, (12) Share-based compensation, (13)
Other operating expenses, including third-party debt expenses and acquisition
costs, (14) Gains or losses on the sale of investments and (15) certain other
non-recurring charges. We define Adjusted EBITDA margin as Adjusted EBITDA
divided by total Operating revenues. We define Adjusted Net income (loss)
attributable to Gannett before (1) Gains or losses on the early extinguishment
of debt, (2) Loss on Convertible notes derivative, (3) Integration and
reorganization costs, (4) Other operating expenses, including third-party debt
expenses and acquisition costs, (5) Asset impairments, (6) Goodwill and
intangibles impairments, (7) Gains or losses on the sale or disposal of assets,
and (8) the tax impact of the above items.

Management’s Use of Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Net Income (Loss) Attributable to Gannett

Adjusted EBITDA, Adjusted EBITDA margin, and Adjusted Net income (loss)
attributable to Gannett are not measurements of financial performance under GAAP
and should not be considered in isolation or as an alternative to income from
operations, net income (loss), or any other measure of performance or liquidity
derived in accordance with U.S. GAAP. We believe these non-GAAP financial
measures, as we have defined them, are helpful in identifying trends in our
day-to-day performance because the items excluded have little or no significance
on our day-to-day operations. These measures provide an assessment of
controllable expenses and affords management the ability to make decisions which
are expected to facilitate meeting current financial goals as well as to achieve
optimal financial performance.

Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Net Income (Loss) attributable to Gannett provide us with measures of financial performance, independent of items beyond management’s control in the short term, such as

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depreciation and amortization, taxation, non-cash impairments, and interest
expense associated with our capital structure. These metrics measure our
financial performance based on operational factors that management can impact in
the short-term, namely the cost structure or expenses of the organization.
Adjusted EBITDA, Adjusted EBITDA margin, and Adjusted Net income (loss)
attributable to Gannett are metrics we use to review the financial performance
of our business on a monthly basis.

We use Adjusted EBITDA, Adjusted EBITDA margin, and Adjusted Net income (loss)
attributable to Gannett as measures of our day-to-day operating performance,
which is evidenced by the publishing and delivery of news and other media and
excludes certain expenses that may not be indicative of our day-to-day business
operating results.

Limits on Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Net Income (Loss) Attributable to Gannett

Adjusted EBITDA, Adjusted EBITDA margin, and Adjusted Net income (loss)
attributable to Gannett have limitations as an analytical tool. They should not
be viewed in isolation or as a substitute for U.S. GAAP measures of earnings or
cash flows. Material limitations in making the adjustments to our earnings to
calculate Adjusted EBITDA, Adjusted EBITDA margin, and Adjusted Net income
(loss) attributable to Gannett and using these non-GAAP financial measures as
compared to U.S. GAAP net income (loss) include: the cash portion of
interest/financing expense, income tax (benefit) provision, and charges related
to asset impairments, which may significantly affect our financial results.

Management believes these items are important in evaluating our performance,
results of operations, and financial position. We use non-GAAP financial
measures to supplement our U.S. GAAP results in order to provide a more complete
understanding of the factors and trends affecting our business.

Adjusted EBITDA, Adjusted EBITDA margin, and Adjusted Net income (loss)
attributable to Gannett are not alternatives to net income and margin as
calculated and presented in accordance with U.S. GAAP. As such, they should not
be considered or relied upon as a substitute or alternative for any such U.S.
GAAP financial measures. We strongly urge you to review the reconciliation of
Net income (loss) attributable to Gannett to Adjusted EBITDA, Adjusted EBITDA
margin, and Adjusted Net income (loss) attributable to Gannett along with our
condensed consolidated financial statements included elsewhere in this Quarterly
Report on Form 10-Q. We also strongly urge you to not rely on any single
financial measure to evaluate our business. In addition, because Adjusted
EBITDA, Adjusted EBITDA margin, and Adjusted Net income (loss) attributable to
Gannett are not measures of financial performance under U.S. GAAP and are
susceptible to varying calculations, the Adjusted EBITDA, Adjusted EBITDA
margin, and Adjusted Net income (loss) attributable to Gannett measures as
presented in this report may differ from and may not be comparable to similarly
titled measures used by other companies.

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The table below shows the reconciliation of Net income (loss) attributable to
Gannett to Adjusted EBITDA and Net income (loss) attributable to Gannett margin
to Adjusted EBITDA margin:
                                                   Three months ended June 30,                    Six months ended June 30,
In thousands                                      2021                       2020                  2021                 2020
Net income (loss) attributable to Gannett   $      15,115                $ 

(436,893) $ (127,201) $ (517,045)
Provision (benefit) for income taxes

               17,692                   (34,276)                 8,583             (25,297)
Interest expense                                   35,264                    57,928                 74,767             115,827
Loss on early extinguishment of debt                2,834                       369                 22,235               1,174
Non-operating pension income                      (23,906)                  (17,553)               (47,784)            (36,099)
Loss on Convertible notes derivative                    -                         -                126,600                   -
Other non-operating income, net                    (1,148)                   (6,261)                (3,023)             (4,616)
Depreciation and amortization                      48,242                    66,327                106,345             144,352
Integration and reorganization costs                8,444                    32,306                 21,848              60,560
Other operating expenses                              774                     2,379                 11,350               8,348
Asset impairments                                       -                     6,859                    833               6,859
Goodwill and intangible impairments                     -                   393,446                      -             393,446
Net loss on sale or disposal of assets              5,294                        88                 10,039                 745
Share-based compensation expense                    5,779                     7,391                  9,202              18,968
Other items                                         1,385                     5,908                  2,440               9,862
Adjusted EBITDA (non-GAAP basis)            $     115,769                $  

78,018 $ 216,234 $ 177,084
Net income (loss) attributable to Gannett’s margin

                                                1.9   %                 (57.0) %                (8.0) %            (30.1) %
Adjusted EBITDA margin (non-GAAP basis)              14.4   %                  10.2  %                13.7  %             10.3  %



The table below shows the reconciliation of net income (loss) attributable to Gannett to adjusted net income (loss) attributable to Gannett:

                                              Three months ended June 30,                    Six months ended June 30,
In thousands                                    2021                 2020                    2021                    2020

Net income (loss) attributable to Gannett $ 15,115 $ (436,893) $ (127,201)

             $ (517,045)
Loss on early extinguishment of debt              2,834                 369                  22,235                   1,174
Loss on Convertible notes derivative                  -                   -                 126,600                       -
Integration and reorganization costs              8,444              32,306                  21,848                  60,560
Other operating expenses                            774               2,379                  11,350                   8,348
Asset impairments                                     -               6,859                     833                   6,859
Goodwill and intangible impairments                   -             393,446                       -                 393,446
Net loss on sale or disposal of assets            5,294                  88                  10,039                     745
Subtotal                                         32,461              (1,446)                 65,704                 (45,913)
Tax impact of above items                        (2,403)             (3,734)                (21,009)                (35,915)
Adjusted Net income (loss) attributable
to Gannett (non-GAAP basis)               $      30,058          $   (5,180)         $       44,695              $  (81,828)

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