Ladies and gentlemen, thank you for standing by, and welcome to the Scripps earnings call. At this time, all lines are in a listen-only mode. Later, we will conduct a question-and-answer session. [Operator Instructions] And as a reminder, today’s conference call is being recorded. I would now like to turn the conference over to Carolyn Micheli. Please go ahead.

Thank you, Cynthia. Good morning, everyone, and thank you for joining us for a discussion of The E.W. Scripps Company’s Financial Results. You can visit scripps.com for more information and a link to the replay of this call. A reminder that our conference call and webcast include forward-looking statement and actual results may differ. Factors that may cause them to differ are outlined in our SEC filings. The COVID-19 pandemic enhances the uncertainty of forward-looking statements we make about our operations and financial conditions. We do not intend to update any forward-looking statements we make today. If you have not yet signed up for Scripps’ Virtual Investor Day, next Wednesday, you can email us at ir@scripps.com to register. We’ll hear this morning from Scripps’ President and CEO, Adam Symson; our new Chief Financial Officer, Jason Combs; the President of our new Scripps’ Networks Division, Lisa Knutson; and our long time Local Media President, Brian Lawlor. Also on the call are Controller, Dan Perschke who is recently promoted from Assistant Controller and has been with Scripps’ for 13 years; our former Controller and Treasurer, Doug Lyons is now overseeing financial strategy and special projects. Now here is Adam.

Good morning, everybody, and thanks for joining us. Today, we present you with an E.W. Scripps Company that has significantly evolved over the last few months. We are exiting the digital audio business to fantastic returns, and we have acquired ION and combined it with Newsy and the Katz Networks to assemble a powerful new national broadcast networks business. Today, Scripps is a full-scale television company and the largest holder of broadcast spectrum in the United States. Our local station group reaches one in four U.S. TV households across the nation to deliver local news and programming over-the-air on pay TV and on internet-based platforms. Our new national networks business, Scripps Networks reaches nearly every American through free broadcast TV on pay TV and across a range of emerging television platforms. As a company, we provide our advertising customers with unparalleled audience reach that is both broad nationally and deep locally more about why I say unparalleled audience reach in a moment. By now, I think our track record supports me, when I tell you we are dedicated as much to our near-term operating performance as to our longer-term value creation. The strategic moves we have made over the last few years, we’ll know they already are paying off for our shareholders. The transformation of our company is about so much more than next quarter’s performance, because we will be exceptionally positioned for the future of television. As we often tell you, Scripps has always been about anticipating and capitalizing on the evolving habits of media consumers. And today, we’re poised to do it again, profiting from the disruption in television. Practically every month, a new D2C subscription service launches, and they’re all battling each other out for a finite share of the American consumers’ wallet. At this point, many…

Thanks very much for that Adam, and good morning, everyone. I’d like to start our discussion of Scripps’ fourth quarter and yearend 2020 results with our Local Media division. This morning, we released tables at the end of the earnings release, giving a look at Local Media for the full year of 2019 and quarterly periods of 2020 as though we had not owned WPIX in New York for those periods. The sale of WPIX closed on December 30, 2020. So my comparisons will be on that adjusted basis using those results for both periods. And just a reminder that the third quarter was our last quarter of adjusted combined treatment for the Cordillera and Nexstar/Tribune station acquisitions. You can find our as reported results in today’s press release. Political advertising revenue ended the quarter at $137 million and we finished the full year at a record $265 million again without the WPIX results. We’re now looking ahead to a few off cycle elections this year and another very big year for the 2022 mid-terms. Local Media core advertising revenue was $170 million in the fourth quarter that represents only an 8% decline from the fourth quarter of 2019, and was much better than our expectations of down mid-teens. We did see significant core displacement from political ads from October 1 to November 3, but after Election Day, we saw core climbing back and we’ve had an acceleration of momentum since the start of the year. For the first quarter of the year, our best year right now is that core will be about flat from the first quarter of 2020 on an adjusted combined basis. Turning to Local Media retransmission revenue, we were up 38% in Q4. If you factor out subs for WPIX in New York, we renewed…

Thanks so much, Jason, and good morning, everyone. I’m thrilled to be joining you in my new capacity as President of the Scripps Networks businesses. We decided to call this newly formed division Scripps Networks, because we want it to be a 100% clear that Scripps did operating a full-scale National television networks business, seven networks that reach nearly every American, either over-the-air, over-the-top or on satellite and cable. Our networks have come together to form a fantastic business, which will provide double-digit revenue growth for the next several years and efficient centralized expense structure and division margins of about 40%. These networks deliver a collection of audience demographics that are attractive – that are attracting premium advertisers and driving strong ad rates. They are playing in the resilient national ad marketplace and capitalizing on the health and growth of the direct response category, as we demonstrated last year, with the impressive performance at Katz. Since our close of ION on January 7, integration of these business has gone exceedingly well. Our leadership team is nearly in place with Jonathan Katz, serving as Chief Operating Officer and head of the entertainment networks. We’re close to hiring a head of the news unit, which includes Newsy and Court TV. Our division’s 750 employees have already been organized into new management reporting structures and launched into their new roles. And we’re on track to achieve the synergies for this year that we’ve previously identified. The bottom line is, we have now put into action the strategies we outlined in our acquisition announcement and you will see immediate value creation. In fact, the foundation of this value creation includes four key growth drivers that we are already beginning to capitalize on. Number one is the growth in the size of the audience watching…

Thanks, Lisa. Good morning, everybody. In 2020, the Local Media division generated nearly $1.5 billion in revenue, while closely managing our expenses leading to record segment profit. That’s a pretty noteworthy performance given the nation’s economy last year. Political and retrans both contributed to our record year in core advertising perform better than expected. Let’s dive into each of these revenue lines. Core advertising revenue began to turn around almost immediately after Election Day. Services were up high single digits in both November and December. And home improvement was up high singles in November and nearly 20% in December. Auto was down only low single digits in December and some sub-categories like foreign factory showing year-to-year growth. Core advertising momentum has continued, as we move through the first quarter. Services and home improvement remain up and auto is down only low single digits despite new production problems with computer chip supply. In addition, sports betting has emerged as a material contributor within our travel and leisure category. That category has been decimated by the pandemics impact on live sporting events, concerts, travel, cruises and even casino attendance. Emergence of sports betting has helped rebound the travel and leisure category, pushing the first quarter positive compared to last year. Sports betting has already legal in seven states, where Scripps on stations with more coming this year. As states make sports betting available to their citizens, the industry is using local broadcast stations as a primary means for getting out their message. Backing out sports betting, travel and leisure remains down about 45% and we eagerly look forward to the return of live events, but that are traditionally robust top five category. Clearly, political advertising continues to be a tremendous value creator for local broadcasters. And we really maximize our opportunity at…

Thank you. [Operator Instructions] And our first question, we will go to line of John Janedis with Wolfe. And your line is open.

Thank you, good morning. I had a couple, maybe in the first one for Adam or Lisa. He talked about the advertising impressions, I know you’re only a few weeks in, but as you talk about the growth levers with the networks. Are there any early anecdotes you can share from the sales team as they sell the larger offering?

Hey, John, it’s Lisa. Yes. We’re optimistic, the year really continued to build on the momentum that was in fourth quarter. So we both in the general market and sort of upfront and scatter market, but also in the DR space strong continued growth in really all categories. Certainly, in fourth quarter, we saw some – that was really bolstered by, certainly, the healthcare, large advertisers in healthcare and obviously, the Medicare spend that was happening in fourth quarter. So we’re seeing momentum and we’re really optimistic, especially as the year builds.

Hey, John. Let me add something to that also. I think important to let investors and analysts know that our early looks at ION’s yield and ION sales processes open up a lot of opportunity. I think in many ways, we had indicated before given the gap between their audience size and their monetization that there would be some opportunity for growth that we – as we close that gap and early indications are, we were right on. I think bringing the networks together with our others in the bundled upfront is going to yield terrific opportunity for all of our networks. And then clearly, we think we can bring some of our expertise with yield management, especially, around direct response to improve the yield and rate at ION. I think that’s what we’ve been saying from the beginning and our investigation of the business as we brought it in integrated event, I think has definitely confirmed that.

Okay, great. And then maybe, Brian, thanks for the color on the categories. As you start to lap the dislocation from the pandemic. What are you seeing? Was there anything notable that you saw called late February heading into March?

Hey, John, it’s Brian. Just the continue momentum, I think, I spoke in my prepared remarks about, the health of services, the health of home improvement, that absolutely continues. Travel and leisure is very strong right now as a result of sports betting. But I think that’s – that retail are the two categories that are probably the slowest to rebound, although retail is having its best month in the last year in March, so that one’s coming back. But I think, when the traditional travel and leisure accounts come back and when retail, when the states begin to allow more people into shopping locations and so forth. I think that’s the one that we have a lot of optimism. And as we look at stimulus money getting in the hands of people, we think that advertisers are going to be anxiously fighting for market share for those dollars and we’ll be pretty aggressive in that space. But I think the big story for March is continued improvement really every category, February was improvement over January, and March is now an improvement over both of those first two months.

All right. Thanks a lot.

Thank you. Our next question comes from the line of Dan Kurnos with the Benchmark. And your line is open.

Thanks, good morning. Nice results again, guys. So just to follow-up on John’s first question, Adam, Lisa, at the risk of opening myself up to the answer, wait until Wednesday. I just curious on, as we get into 2021, just how you’re thinking about mix by channel the national, obviously, the story from Katz originally was getting more into general market and obviously you’ve had tremendous success lately with direct response, just given some of the performance based optionality there. I’m just curious if you could give us maybe some initial high-level thoughts there. And then Brian, did I hear you say that political in 2022 would be better than 2020?

Yes. Dan, I did say that.

Okay.

Hey, Dan. I’ll start with this. You’re right. And I know you love hearing that. You will have to wait to some extent till Wednesday, at which time I think we will provide, I think some information that will allow you to better scope the contribution of each of the different advertising categories to the networks performance. So recognizing that the networks themselves are made up of really general market and direct response and OTT and each have, I think, growth opportunities ahead. But it’s different per network. And Lisa will spend a fair bit of time on that on Wednesday.

Certainly, that you’re wrong, Adam. So the other one, just maybe just on Newsy, just some updates on your thoughts heading into this year, obviously, there’s been a huge DTC TV push, Newsy’s been chugging along nicely. You’ve got strong distribution agreements in place now, just kind of maybe your thoughts on scaling and sort of how profitability continues to improve from here.

Yes, Dan. You’re right, again, Newsy had tremendous growth in 2020, growing about 20%. Really a majority of that growth came – really most of the growth came on the back of expanded OTT advertising. And so we will just continue to maximize that. I think we talked maybe in the last call about the fact that, we are really the leaders in from a programmatic advertising perspective and Newsy is really capitalizing on that. And so we’ll continue to pull back growth driver, because we see that definitely as a big opportunity for Newsy going forward. And we’ll bring that same platform to the other networks as we look at expanding on the programmatic side with our other networks.

All right. Awesome. Thanks guys. Really appreciate it.

Thank you. Our next question comes from the line of Steven Cahall with Wells Fargo. Your line is open.

Thanks. So, Adam, thanks for the increase in free cash flow accretion related to ION. Maybe first off, what’s driving that? What’s changed now that you’ve owned the business for a couple of months? And does that include the Berkshire warrants in that calculation?

Hey, Steven. It’s Jason. So first of all, to answer on the virtue yes, that includes the payment that we’ll need to make for the Berkshire warrants. The main thing that’s improving accretion, this point is really lower interest expense in our outlook. First of all, we received more favorable financing rates than we had originally modeled at the outside of the deal. Also the Triton’s sale proceeds will allow us to pay down debt in 2021. And then also the Stitcher and WPIX divestitures resulted in us having more cash available at the time of the financing and thereby financing less. So all those are kind of driving into lower interest expense.

Yes. Great. And then you mentioned that you’ll be the biggest owner of broadcast spectrum. You all have been on asset monetization care. Is the spectrum that you have? Is there any excess that you might monetize in the future? Or do you require all that spectrum given all the OTA content you have now?

Actually, I think that today, not only are we the largest holder of broadcast spectrum, but I would say, we’re the most efficient monetizer of that spectrum, given the operating businesses that we have leveraging that spectrum. And I think Lisa described the opportunity we have with respect to the growth drivers, among them, the efficient expansion of our networks business to continue and take advantage of our leadership share position in the free television marketplace. So I would say that we are actively working on strategies to identify the best and highest use of that spectrum with respect to the transition to ATSE 3.0, new data casting possibilities. But the hurdle rate is high, because we expect to continue and expand the profitability of our production over that spectrum through our operating businesses right now.

Yes. And then last one for me, just the mundane local media one, any outlook for net retrans for the year.

A mundane question for local media. Hey, Steven, it’s Brian. Look, as you know, we completed renewals last year for about half of our pay TV households and we were pleased with the outcome of those. As a reminder, the Comcast rates renewed to December 31, a year ago. And so all of that drove 30% grocery trends revenue in 2020 over 2019 on the same-station basis. Because we had no network renewals this year and don’t have any new ones until the end of next year and the cadence of rate, step-ups and expenses was in our favor this year. We have not given 2021 guidance, but I can say that the timing of margin growth is entirely tied to the timing of our contract renewal. So we’ve got about 4% households renewing this year, a little bit more than 20% next year and then the big year, again, two years from now, 75%. So, I guess I would just add the successful renewals of these and our revenue growth or margin expansion, they’ve all kind of validated our thesis about buying 28 television stations last year. And I think all of that role together has made us a much stronger division in company.

Great. Thank you.

Thank you. Our next question comes from the line of Kyle Evans from Stephens. And your line is open.

Hi, thanks. It’s clear that Scripps Networks is the dominant player. But maybe it’s just some brief commentary on the competitive landscape, especially, as we saw TEGNA launch Twist and I guess, I’m wondering, are we going to see a new station rollout race between you guys. And then I’ve got some follow-ups?

Yes, look, I mean, I think we encourage and we’re pleased to see more premium content being put into the live TV ecosystem. I think for a long time, our networks stood alone as networks that were focused on creating brands and developing programming that was more than just stuff that was on the shelf. And I think that we’re pleased to see that the marketplace will develop, because that will make free television a more compelling consumer proposition overall. I do think our leadership share is significant. I think the economics behind the ION acquisition and our ability to continue to expand that share and to profitably operate are unparalleled. And so while I certainly expect, they’ll continue to be more development in the free TV ecosystem. I don’t think anybody will be able to do it with the economics that we have and to start with the distribution that we’re able to bring to the country right away. So I do think – I do, of course, expect the marketplace to develop and I expect us to continue our leadership by afar stretch. Lisa?

Yes. Just one other thing I would mention, remember in the – our network, the former Katz networks, the landscape in which they’re competing in. There are only 13 of those networks that are Nielsen rated. Five of those networks are our networks. And I think that’s a proxy for actually people watching those networks and us being able to monetize those networks through the eyeballs that we’re selling. So I think we are the dominant player and we will continue to be as we move forward.

Great. While I have you, I think there was a January release from you guys about exceeding the $500 million in synergies, maybe some detail on that, please.

Yes, I think there was a release early on, Jason can say more about the synergies, but we did. We hit the ground running Kyle with, certainly, beginning to lock in the synergies that we promised at the time of the acquisition thesis. I think there was a release early January, Jason, that outlined some of those,

Correct. Yes. We had a release, which was focused on, how quickly we’ve been able to operationalize the headcount corporate synergies. And on the distribution side, we’re actually diligently working through those synergies right now. In fact, the migration of – the first of our Katz channels over to high-end distribution signal begins this weekend.

Kyle, that will be the – really the first consumer facing step in delivering on our plan. That’s happening over the weekend. So more to come.

Great. Adam, it was a different world, you were a much smaller business. But I recall that at one point, there was a lot of discussion about kind of end-market and swaps and we’re waiting for a Supreme Court ruling in June. Maybe just your high-level thoughts on what that could mean for end-market activity going forward on the local side.

Sure. I mean, we remain committed to continue to improve the performance of our Local Media portfolio. I think one of the ways we could do that is by picking up second stations by continuing to get deeper in the markets where we already operate. We don’t break it out of course, but a local state – two local stations in a market is much more productive than just one. We just recently sort of quietly picked up a second station in Denver and we expect that that will enhance the margin of our operation in Denver and enhance the cash flow generation there as well. We’ve already launched news on that second station and our optimizing the programming, and that’s been very, very efficient. That was a really efficient acquisition of a second station. I think we paid $9 million for the station. And I would expect that if the Supreme Court opens up the opportunity for broadcasters to get deeper in the markets where they already operate something that we would welcome. I think you would definitely see us participate in that swapping opportunity.

Great, thank you.

Thank you. Our next question comes from the line of Michael Kupinski with NOBLE Capital Markets. Your line is open.

Thank you. First, I want to wish Rich well on his retirement. I remember when he was a reporter, he used to call me for quotes regarding media. So I wish him all the best. So first Brian, can you talk about rate integrity throughout 2020? I – obviously the pandemic had a big hit on that. And I was just wondering as you kind of look at – I’m just trying to get a little bit of flavor or color as we kind of cycle through the second quarter. What have rates started and how have you maintained rate?

Yes, I think through 2020 Mike, we had obviously stay fluid with how we’re running the business. We knew that we had a big political business that was going to back – run through the back half of the year. Obviously, we had to manage our lowest unit rates and make sure that we accommodated inventory for the politicians. So to some degree that gave us rate protection. Early in April, May, June of last year, we were scrapping for every dollar we could, when we’re outside the political windows. And I think that served us well. I think all that’s behind us, we following the election, good core momentum in November build on that in December. Now, we’re having a very strong first quarter, very exciting – excited about the health of the quarter. And as we build toward second quarter, we have a lot more optimism that the categories are going to continue to improve. I think as you know in the next couple of days as Washington votes on a stimulus, that’s going to put a lot of money into the economy. And I think that has the potential to drive a lot of advertisers fighting for a share of those dollars. So I think our rates currently are not impacted by what happened at the beginning of last year. We were really back to full recovery there.

Okay. So that basically rates are at 2019 levels.

I think that’s probably a good way to say it.

Okay. And how much of your network comp is variable versus fixed?

It really depends network to network. We have different arrangements with all four networks.

But collectively, what would you say?

Yes, I don’t think we’ll comment on that.

Okay. And then you obviously bought ION in the midst of a pandemic and you mentioned the sales gap. Can you talk about ION and if the operations were aligned with what you thought in 2020, and if not, are there additional changes you plan to make outside of the sales changes that you were talking about?

Hey Mike, yes, so we’re really creating a scale business bringing together ION, Katz and Newsy. So each of them independently ran as businesses in 2020 and starting really immediately, we’re operating them as one business, combining sales, combining everything from marketing to the back office, so to speak functions around creative services and research. And so whereas each of those businesses in the past would have had things like that each individually. So we really within the first, I think week announced our organizational structure hit the ground running in terms of bringing together those businesses. As you heard in my prepared comments, what we think the drivers of value are. One of those really is the yield management that Adam talked about and I talked about. I think having – being ready to do a combined upfront with all of our businesses in that upfront was a herculean task. We think it will pay dividends this year as we’re selling these businesses across platform or across brands. And so we really think that we’re not losing any time to really maximize the opportunity that we see here.

Great. And going back to Brian, you indicated that off year election advertising, you’re expecting to be pretty good this year. Can you give us some color on those comments? And how that would compare to what you were – would have in and out like say 2019? I mean I’m just trying to get some color on what that comment means.

Yes. Well, I think what were our comments today indicate that we see Q1 flat to last year. I think that speaks to very strong recovery marches up compared to last March. So and it has a lot of momentum. And we think that’s going to continue into…

Political advertising.

Yes, the political advertising specifically. Yes.

Yes, so this fall election.

How do we feel about this fall’s elections? I’m sorry, Mike.

Yes, yes, that’s okay.

Yes, look, we only have a Governor race in Virginia this year, so we had very little at the statewide, but we do think that there’ll be some pretty good issue money that starts in the back half of the year. I think with 18 Senate races up next year and a 50/50 Senate. I think you’re going to see some early spending in the races that are considered to be tight or tossup. And so we think it’s going to get an early start in the back half of the year.

Got you. Okay. Thank you. That’s all I have. Thanks.

Thank you. Our next question comes from the line of Craig Huber with Huber Research Partners. And your line is open.

Great. Thank you. My first question, sort of a nitpick, but you guys mentioned retrans subs down 1% quarter-over-quarter. Shine for that means down about 5%, 6% a year-over-year basis on a like for like basis.

Yes. Hey Craig, it’s Brian. We’re down about mid-single digits over the last 12 months ending in Q3.

You think that was similar for the latest quarter as well?

Well, no, for the last quarter, we were down about 1% from Q2 to Q3.

No, no, I’m sorry, but just year-over-year for that third quarter you talk about rather than just four quarters a trailing basis.

Yes. I need to go back and look.

Okay.

Hey Craig, it’s Jason. Yes. So the down mid-single digits comment is referring to the last reported four quarter we have is Q3 data. So that is a from Q3 of 2020 to Q3 of 2019. It’s the down mid-single digits.

Okay. That’s helpful. Jason, maybe you could just update us on this, your long-term goal for your debt ratio. What is that on a sustained basis? Where are you guys trying to get it down to? I mean maybe just to level set everything here. Where is your debt ratio right now adjusting for all the acquisitions, the acquisition stuff, and divestitures as well-pleased on a tutor a blended average basis, please.

Yes. So at year end, prior to ION acquisition, we were at 3.7 times net leverage. At the ION deal close we’re at 5.0 times, which is better than we had initially indicated when we announced the deal we had originally thought, we’d be at 5.3 times in obviously strong fourth quarter ended WPIX proceeds helped us to come in a little bit lower there. I think ultimately, our target leverage is in the mid-3s. It is managing the company towards a clean and flexible balance sheet has always been top priority and certainly with something that’s in Scripps DNA. And the attractiveness of the ION transaction really compelled us to put our balance sheet to work to create a higher performing and more durable company. And so as I said, we’re at 5 times on a lagging a quarter basis now, and we believe that our new cash flow outlook will allow us to move swiftly towards de-levering.

Couple quick things on ION, does ION have any significant amount of political advertising? And my other question is I recall you guys talking about when you maybe now that it had a 12% tenure revenue CAGR through 2019, obviously very impressive. Do you expect to be able to get revenue growth back up anywhere near that level, once we get through this pandemic, maybe even after we annualize it, I mean what’s your thoughts there please?

Yes. Craig, ION had a tiny amount of political revenue last year. So it was pretty insignificant. Remember, they – ION and the way that we will run this really is as a national network. So it doesn’t necessarily play in the same the local spots of Brian’s division sells in. As for revenue CAGR, I think I indicated in my remarks that over the next several years, we think that ION’s or the combined networks revenue will grow around 10%. So we think that that’s probably a best in class. And we think that that revenue growth is certainly projected to be double-digit – low-double digit growth over the next two years.

If you talk about with Katz and with ION combined, everything combined okay.

Yes. That’s the entire network business, Scripps Networks business.

And my last question on ION, I just want to ask, are you contemplating any programming changes there going forward? I know it’s early.

Yes. Certainly, we are always looking at tweaking some of the programming that ION done. They’ve been hugely successful. In fact, ION retained its fifth this rating and a ranking in terms of the largest broadcast network last year, and really from a cable perspective viewing would be number three behind a couple of the news networks from last year. And so we think there are tweaks that we will need to make, but essentially the formula that ION has been pretty successful.

My last question, Brian, maybe if you just update us please on ATSE 3.0, the business model there, and how long do you think it might take to become a significant to you on the revenue contribution side? How many years out do you think? Thank you.

Hey Craig, it’s Adam. I’ll take this. I think it’s still fairly far out given the need for consumers to adopt new devices that will bring in our signals. So while today, we are aggressively continuing to efficient and efficiently transitioned to a 3.0 signal along with the rest of the industry. We’re working with the CE manufacturers to take the 3.0 chips and move them, not just from the highest end television sets, but down to a TV sets that you could buy at Walmart and Costco. And frankly also I think a big part of that equation is going to be also new set top boxes and dongles that consumers will be able to plug in and that will transform their TV sets into 3.0 sets. So there’s some time for that to happen. I think you’ll see us continue play a leadership role in that transition. But when I speak to investors, I’m pretty clear. I think right now, this is three to five years out and the first effect is likely going to be on yield management. The opportunity for us to use 3.0’s multi-variable advertising capabilities to enhance rate into enhanced yield. But again, that’s a little bit farther out. And I think we’ll continue to communicate with transparency to the Street as the transition occurs.

Great. Thank you.

Thank you. Our next question comes from the line of Matt Swope with Baird. And your line is open.

Yes. Good morning, guys. Jason, can I just follow-up on your debt comments? You talked about paying down more than $300 million when the Triton sale closes. Would you think about paying down your callable bonds with that at that point, or would that be for bank debt? How do you think about that?

Yes. Hey Matt, so I mean we can prepay any portion of our term loans at any time, but to your point, we would certainly also focus on our cost of capital or the highest cost of capital, which would be our 2025 and 2027 bonds. And our 2025 bonds are outside in the no-call premium. So it would certainly be something that we would look at.

Would you take it far enough? And then you mentioned in the lower interest rates than you expected, and obviously your new bonds have traded quite well. Would you even consider coming back to market and doing a little more to take those all the way out and to maybe pay down some bank debt?

So I mean I think it’s something certainly we’d look at, but I think we’re also in the early stages from an integration standpoint of really getting a good feel for your cash list a year. And so I think there are a lot of other factors that will go into it. I also do think right now from a debt structure perspective, we are happy with kind of the mix we have.

Got it. I really appreciate it. Thank you.

Thank you. We’ll go to the line of Eric Green with Penn Capital. Your line is open.

Thank you. Hi, Adam. Hi, team. Can you speak about the potential for the large tech companies to pay for news content as we’re seeing in Australia that you in Canada, what kind of opportunity could that ultimately be for your firm – your company, as well as the industry.

Hi Eric, good to talk to you. I do expect that this will eventually move to the U.S. where the things end up paying their fair shares and news creators. I do expect that local broadcast stations like ours will be at the table developing those relationships. And I think you will see us at Scripps play an active role in those conversations.

Great, thank you.

Thank you. And at this time, we have no further questions. Speakers, please continue with any closing remarks.

Thank you, Cynthia, and thanks to everyone for joining us today. And again, if you’d like to join us for Investor Day, you can email ir@scripps.com. Have a good day.

Thank you. And ladies and gentlemen, that does conclude your conference call for today. Thank you for your participation and for using AT&T executive teleconference service. You may now disconnect.