Lee Enterprises, a top U.S. newspaper company, shared an update April 5 on their digital transformation strategy.
“With strong momentum, including the completion of a compelling transaction with Berkshire Hathaway in fiscal 2020, Lee is accelerating our transformation as a top digital news and information provider. Today, Lee is the fastest growing digital subscription platform in local media, and we are building on our bold course for our digital future as we enter our next chapter. We will be guided by a multi-year strategy that leverages our attractive market position, enhanced balance sheet, well-established digital infrastructure, and talented team. As we execute, Lee will expand our subscriber base, grow our base of annualized recurring revenue, drive new revenue streams with enhanced capabilities for advertisers, and create value for shareholders.”
“We are focused on unlocking the full value of Lee, consistent with the valuations awarded to industry peers and similar digital-first media companies. As we execute our strategy and continue to repay debt, we see significant opportunity for value creation.”
Kevin Mowbray, President and Chief Executive Officer of Lee Enterprises
Mowbray says Lee has made “significant progress” on their plan. He points to Lee’s 69% digital subscriber growth in each of the last five quarters. The Lee CEO also highlighted:
- Lee’s “significant investments in talent and technology” to propel their digital transformation
- The company’s new niche content platforms and tech to drive subscription conversions.
- Centralized “Amplified Digital Agency”
- Their “Brand Avenue Studios” custom content division
- Expansion of their sales org to 900+ sellers focused on powering renenue through e-commerce and “first party data sales strategies”
Lee Enterprises Three Pillar Growth Strategy
- Transform the presentation of local news and information by providing best-in-class reader and user experiences with digital presentations that emphasize video and other multimedia formats and rich, high-value content.
- Accelerate overall subscription growth by converting more of our vast addressable market to subscribers leveraging cutting-edge data and technology and expanded offerings for paid, niche content on topics where Lee has expertise and unique selling positions.
- Diversify and expand offerings for advertisers by launching a portfolio of video advertising initiatives and e-commerce sales strategies through Lee’s in-house Amplified Digital Agency that will enable advertisers to leverage Lee’s vast data-rich digital audiences and reach consumers in new ways.
Long-Term Targets
Within the next five years, Lee aims to realize the following goals:
- Grow total paid subscribers, reaching 900,000 digital-only subscribers;
- Generate $100 million in annualized revenue from their Amplified Digital Agency, which is expected in three years
- Achieve their long-term leverage target of under 2.5x.
Move to Nasdaq
Lee announced it intends to transfer its stock exchange listing from the New York Stock Exchange to the Nasdaq Global Select Market. Lee shares are expected to begin trading as a Nasdaq-listed security on April 19, 2021. The symbol will be “LEE.”.
“Trading on Nasdaq positions Lee alongside the world’s most innovative and forward-thinking technology leaders as we accelerate our ongoing digital transformation. We look forward to leveraging Nasdaq’s platforms and solutions to support ongoing engagement with our investors and access to information in a way that is a cost-effective and seamless.”
Kevin Mowbray, President and Chief Executive Officer of Lee Enterprises
