Thursday, March 08, 2012

Stock | Here's hoping these buybacks pan out

[Specimen of a Gannett stock certificate]

Last month, Corporate announced plans to buy back another $300 million worth of Gannett stock over the next two years, adding to the $53 million spent last year to repurchase 4.9 million shares.

Last year’s shares cost an average $11 each -- a good investment, considering GCI closed yesterday at $14.41 a share. And that doesn’t factor in the savings reaped by not paying dividends on those shares.

But Corporate’s longer term record on repurchases remains abysmal.

It paid $1.8 billion for 28.4 million shares during an earlier buyback campaign, in 2005-2008 -- a period when the company piled up billions in debt that sent the company skittering toward bankruptcy during the financial crisis. Those shares cost an average $64 a each, according to annual 10-K reports to the U.S. Securities and Exchange Commission.. Today, they’re worth just $409 million.

Last year's repurchases brought the total to 33.3 million shares, and an overall average cost of $56 each.

Here’s a table showing the history of buybacks (and a bigger, easier-to-view version):

Earlier: For the fifth consecutive year, GCI shares lag rest of industry.


  1. This is an amazing stat, Jim. Fine work. You've just exposed the absurd thinking of management and a rubber stamping board with short term memory issues.

    Unfortunately, rank and filers suffering furloughs, layoffs, frozen pensions and paltry raises pay the price.

    Brilliant strategy. Now some corporate shill will probably say how the buy backs have created a floor for the stock price.

    Why will this buy back work when the others obviously haven't? Think of what could have been done with this money.

  2. Time to hire a Vice President of Share Repurchasing to get this program right. Perhaps they'll find a more efficient way of flushing money down the drain.

  3. As CFO during much of this time, Martore has a lot of 'spraining to do. this is sheer insanity.

  4. They're buying back the shares so they can "award" them to the execs.

  5. No, they've already set aside shares for The Chosen. These are just removed from the public float. They're just gone, like so many former Gannettoids.

  6. How does something like this happen? Even with all the board turnover, someone with institutional knowledge of the company had to know this was a failed strategy. There's no way the stock price will ever come close to $56 again.

  7. Someone better reign in these crazies at corporate,fast.
    Bat Boy, bring the lumber over and knock some sense Into these people. Be sure to swing by USA Today, too.

  8. If they want to continue throwing money out the window, could someone alert me? I'd like to get me some.

  9. Talk about abdicating your fiduciary responsibility. Tom Buesse should make all directors reapply for their board seats. At reduces pay, of course.

  10. The proof is the pudding, as they say. These stats say it all. And it's legal. Immoral, since the only point is a bonus in shares for the execs, but legal. No such thing as morality in capitalism, dare say.

  11. Brilliant. Frigging brilliant.


Jim says: "Proceed with caution; this is a free-for-all comment zone. I try to correct or clarify incorrect information. But I can't catch everything. Please keep your posts focused on Gannett and media-related subjects. Note that I occasionally review comments in advance, to reject inappropriate ones. And I ignore hostile posters, and recommend you do, too."

Note: Only a member of this blog may post a comment.