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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q

☑ |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2020
OR

☐ |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

|  | For the transition period from to

Commission File Number 001-10701
THE E.W. SCRIPPS COMPANY
(Exact name of registrant as specified in its charter)

Ohio |  | 31-1223339
(State or other jurisdiction of incorporation or organization) |  | (IRS Employer Identification Number)

312 Walnut Street
Cincinnati, Ohio 45202
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (513) 977-3000
Not applicable
(Former name, former address and former fiscal year, if changed since last report.)
Securities registered pursuant to Section 12(b) of the Act:

Title of each class | Trading Symbol(s) | Name of each exchange on which registered
Class A Common Stock, par value $0.01 per share | SSP | NASDAQ Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☑ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer | ☑ | Accelerated filer | ☐ | Emerging growth company | ☐
Non-accelerated filer | ☐ | Smaller reporting company | ☐ |  |

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☑
Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. As of March 31, 2020, there were 69,456,797 of the registrant’s Class A Common shares, $0.01 par value per share, outstanding and 11,932,722 of the registrant’s Common Voting shares, $0.01 par value per share, outstanding.

Index to The E.W. Scripps Company Quarterly Report
on Form 10-Q for the Quarter Ended March 31, 2020

Item No. |  | Page
PART I - Financial Information |  |
1. Financial Statements |  | 3
2. Management's Discussion and Analysis of Financial Condition and Results of Operations |  | 3
3. Quantitative and Qualitative Disclosures About Market Risk |  | 3
4. Controls and Procedures |  | 3
PART II - Other Information |  |
1. Legal Proceedings |  | 3
1A. Risk Factors |  | 3
2. Unregistered Sales of Equity Securities and Use of Proceeds |  | 4
3. Defaults Upon Senior Securities |  | 4
4. Mine Safety Disclosures |  | 4
5. Other Information |  | 4
6. Exhibits |  | 5
Signatures |  | 6

2

PART I
As used in this Quarterly Report on Form 10-Q, the terms “Scripps,” “Company,” “we,” “our,” or “us” may, depending on the context, refer to The E.W. Scripps Company, to one or more of its consolidated subsidiary companies, or to all of them taken as a whole.
Item 1. Financial Statements
The information required by this item is filed as part of this Form 10-Q. See Index to Financial Information at page F-1 of this Form 10-Q.
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
The information required by this item is filed as part of this Form 10-Q. See Index to Financial Information at page F-1 of this Form 10-Q.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
The information required by this item is filed as part of this Form 10-Q. See Index to Financial Information at page F-1 of this Form 10-Q.
Item 4. Controls and Procedures
The information required by this item is filed as part of this Form 10-Q. See Index to Financial Information at page F-1 of this Form 10-Q.
PART II
Item 1. Legal Proceedings
We are involved in litigation and regulatory proceedings arising in the ordinary course of business, such as defamation actions and governmental proceedings primarily relating to renewal of broadcast licenses, none of which is expected to result in material loss.
Item 1A. Risk Factors
Other than the risk factor set forth below, there have been no material changes to the risk factors disclosed in Item 1A. Risk Factors in our 2019 Annual Report on Form 10-K.
The coronavirus (COVID-19) pandemic has materially affected how we, our vendors and our customers are operating, and the extent to which this pandemic will impact our future results of operations and overall financial condition remains uncertain.
The global spread of COVID-19 has created significant volatility, uncertainty and disruption in economies around the world. The extent to which the coronavirus pandemic impacts our operations, financial results and financial condition will depend on numerous evolving factors that we may not be able to accurately predict, including: governmental, business and individuals’ actions that have been and continue to be taken in response to the pandemic; the impact of the pandemic on economic activity and actions taken in response; the effect on our customers, including advertisers, and their demand for our services; our ability to sell and provide our services, including as a result of travel restrictions and individuals working from home; the ability of our customers to pay for our services; and any closures of our offices and facilities or those of our vendors and our customers. Customers may also slow down decision making, delay planned advertising or seek to modify or terminate existing agreements with us.
The duration of the pandemic and the extent of the impact on us and others depend on future developments out of our control that are unknown at this time, such as the severity and transmission rate of the virus, the extent and effectiveness of containment actions, the pace of development of cures or vaccines, and the impact of these and other factors on our business, employees, vendors and customers. Any of these factors could exacerbate other risks and uncertainties disclosed in our Annual Report on Form 10-K and could materially adversely affect our business, financial condition, results of operations and/or stock price.
3

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
There were no sales of unregistered equity securities during the quarter ended March 31, 2020.
In November 2016, our Board of Directors authorized a repurchase program of up to $100 million of our Class A Common shares. We repurchased a total of $50.3 million of shares under the authorization prior to its expiration on March 1, 2020. In February 2020, our Board of Directors authorized a new share repurchase program of up to $100 million of our Class A Common shares through March 1, 2022. Shares can be repurchased under the authorization via open market purchases or privately negotiated transactions, including accelerated stock repurchase transactions, block trades, or pursuant to trades intending to comply with Rule 10b5-1 of the Securities Exchange Act of 1934. No shares were repurchased under either authorization during the first quarter of 2020.
Item 3. Defaults Upon Senior Securities
There were no defaults upon senior securities during the quarter ended March 31, 2020.
Item 4. Mine Safety Disclosures
None.
Item 5. Other Information
The following table presents information on matters submitted to a vote of security holders at our May 4, 2020 Annual Meeting of Shareholders:

Descriptions of Matters Submitted |  | In Favor |  | Against |  | Authority Withheld
1. Election of Directors |  |  |  |  |  |
Directors elected by holders of Class A Common Shares: |  |  |  |  |  |
Lauren Rich Fine |  | 41,616,753 |  | — |  | 8,144,003
Wonya Y. Lucas |  | 41,680,519 |  | — |  | 8,080,237
Kim Williams |  | 41,248,012 |  | — |  | 8,512,744
Directors elected by holders of Common Voting Shares: |  |  |  |  |  |
Marcellus W. Alexander, Jr. |  | 10,736,776 |  | — |  | —
Charles L. Barmonde |  | 10,736,776 |  | — |  | —
Richard A. Boehne |  | 10,736,776 |  | — |  | —
Kelly P. Conlin |  | 10,736,776 |  | — |  | —
John W. Hayden |  | 10,736,776 |  | — |  | —
Anne M. La Dow |  | 10,736,776 |  | — |  | —
R. Michael Scagliotti |  | 10,736,776 |  | — |  | —
Adam P. Symson |  | 10,736,776 |  | — |  | —
2. Vote by holders of Common Voting Shares to ratify Deloitte & Touche LLP as the independent registered public accountant |  | 10,736,776 |  | — |  | —
3. Advisory (non-binding) vote by holders of Common Voting Shares on executive compensation of named executive officers |  | 10,736,776 |  | — |  | —

4

Item 6. Exhibits

Exhibit Number |  | Exhibit Description
31(a) |  | Section 302 Certifications
31(b) |  | Section 302 Certifications
32(a) |  | Section 906 Certifications
32(b) |  | Section 906 Certifications
101 |  | The Company's unaudited Condensed Consolidated Financial Statements and related Notes for the quarter ended March 31, 2020 from this Quarterly Report on Form 10-Q, formatted in iXBRL (Inline eXtensible Business Reporting Language).*
104 |  | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

* - Filed herewith
5

Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

| THE E.W. SCRIPPS COMPANY
Dated: May 8, 2020 | By: | /s/ Douglas F. Lyons
|  | Douglas F. Lyons
|  | Senior Vice President, Controller and Treasurer
|  | (Principal Accounting Officer)

6

The E.W. Scripps Company
Index to Financial Information (Unaudited)

Item |  | Page
Condensed Consolidated Balance Sheets |  | F-2
Condensed Consolidated Statements of Operations |  | F-3
Condensed Consolidated Statements of Comprehensive Income (Loss) |  | F-4
Condensed Consolidated Statements of Cash Flows |  | F-5
Condensed Consolidated Statements of Equity |  | F-6
Notes to Condensed Consolidated Financial Statements |  | F-7
Management’s Discussion and Analysis of Financial Condition and Results of Operations |  | F-19
Quantitative and Qualitative Disclosures About Market Risk |  | F-30
Controls and Procedures |  | F-31

F-1

The E.W. Scripps Company
Condensed Consolidated Balance Sheets (Unaudited)

(in thousands, except share data) |  | As of March 31, 2020 |  | As of December 31, 2019
Assets |  |  |  |
Current assets: |  |  |  |
Cash and cash equivalents |  | $ | 179,627 |  |  | $ | 32,968 |
Accounts receivable (less allowances— $3,961 and $3,546) |  | 401,409 |  |  | 413,567 |
Programming |  | 7,779 |  |  | 60,184 |
FCC repack receivable |  | 29,241 |  |  | 29,651 |
Miscellaneous |  | 52,754 |  |  | 41,074 |
Total current assets |  | 670,810 |  |  | 577,444 |
Investments |  | 11,434 |  |  | 8,553 |
Property and equipment |  | 377,317 |  |  | 375,904 |
Operating lease right-of-use assets |  | 135,138 |  |  | 138,640 |
Goodwill |  | 1,275,327 |  |  | 1,271,855 |
Other intangible assets |  | 1,047,791 |  |  | 1,061,791 |
Programming (less current portion) |  | 146,187 |  |  | 96,256 |
Deferred income taxes |  | 11,602 |  |  | 11,802 |
Miscellaneous |  | 20,069 |  |  | 19,108 |
Total Assets |  | $ | 3,695,675 |  |  | $ | 3,561,353 |
Liabilities and Equity |  |  |  |
Current liabilities: |  |  |  |
Accounts payable |  | $ | 43,389 |  |  | $ | 29,153 |
Unearned revenue |  | 8,572 |  |  | 11,678 |
Current portion of long-term debt |  | 10,612 |  |  | 10,612 |
Accrued liabilities: |  |  |  |
Employee compensation and benefits |  | 30,798 |  |  | 45,701 |
Programming liability |  | 75,004 |  |  | 96,682 |
Accrued interest |  | 14,180 |  |  | 15,352 |
Miscellaneous |  | 64,991 |  |  | 46,624 |
Other current liabilities |  | 26,725 |  |  | 43,678 |
Total current liabilities |  | 274,271 |  |  | 299,480 |
Long-term debt (less current portion) |  | 2,078,232 |  |  | 1,904,418 |
Deferred income taxes |  | 34,575 |  |  | 19,833 |
Operating lease liabilities |  | 121,947 |  |  | 123,739 |
Other liabilities (less current portion) |  | 301,330 |  |  | 315,948 |
Equity: |  |  |  |
Preferred stock, $.01 par — authorized: 25,000,000 shares; none outstanding |  | — |  |  | — |
Common stock, $.01 par: |  |  |  |
Class A — authorized: 240,000,000 shares; issued and outstanding: 69,456,797 and 69,027,524 shares |  | 695 |  |  | 691 |
Voting — authorized: 60,000,000 shares; issued and outstanding: 11,932,722 and 11,932,722 shares |  | 119 |  |  | 119 |
Total |  | 814 |  |  | 810 |
Additional paid-in capital |  | 1,119,485 |  |  | 1,117,095 |
Accumulated deficit |  | (136,898 | ) |  | (120,981 | )
Accumulated other comprehensive loss, net of income taxes |  | (98,081 | ) |  | (98,989 | )
Total equity |  | 885,320 |  |  | 897,935 |
Total Liabilities and Equity |  | $ | 3,695,675 |  |  | $ | 3,561,353 |

See notes to condensed consolidated financial statements.
F-2

The E.W. Scripps Company
Condensed Consolidated Statements of Operations (Unaudited)

|  | Three Months Ended March 31,
(in thousands, except per share data) |  | 2020 |  | 2019
Operating Revenues: |  |  |  |
Advertising |  | $ | 259,714 |  |  | $ | 174,241 |
Retransmission and carriage |  | 138,950 |  |  | 87,283 |
Other |  | 32,242 |  |  | 30,639 |
Total operating revenues |  | 430,906 |  |  | 292,163 |
Costs and Expenses: |  |  |  |
Employee compensation and benefits |  | 149,919 |  |  | 110,203 |
Programming |  | 144,969 |  |  | 97,995 |
Other expenses |  | 87,080 |  |  | 61,442 |
Acquisition and related integration costs |  | 4,910 |  |  | 3,480 |
Restructuring costs |  | — |  |  | 938 |
Total costs and expenses |  | 386,878 |  |  | 274,058 |
Depreciation, Amortization, and (Gains) Losses: |  |  |  |
Depreciation |  | 13,528 |  |  | 8,975 |
Amortization of intangible assets |  | 14,387 |  |  | 8,817 |
(Gains) losses, net on disposal of property and equipment |  | 1,433 |  |  | 173 |
Net depreciation, amortization, and (gains) losses |  | 29,348 |  |  | 17,965 |
Operating income |  | 14,680 |  |  | 140 |
Interest expense |  | (25,798 | ) |  | (8,916 | )
Defined benefit pension plan expense |  | (1,026 | ) |  | (1,572 | )
Miscellaneous, net |  | 1,114 |  |  | (800 | )
Loss from operations before income taxes |  | (11,030 | ) |  | (11,148 | )
Provision (benefit) for income taxes |  | 779 |  |  | (4,334 | )
Net loss |  | $ | (11,809 | ) |  | $ | (6,814 | )
Net loss per basic share of common stock |  | $ | (0.15 | ) |  | $ | (0.08 | )
Net loss per diluted share of common stock |  | $ | (0.15 | ) |  | $ | (0.08 | )

See notes to condensed consolidated financial statements.
F-3

The E.W. Scripps Company
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | 2019
Net loss |  | $ | (11,809 | ) |  | $ | (6,814 | )
Changes in defined benefit pension plans, net of tax of $286 and $155 |  | 902 |  |  | 460 |
Other |  | 6 |  |  | — |
Total comprehensive loss |  | $ | (10,901 | ) |  | $ | (6,354 | )

See notes to condensed consolidated financial statements.
F-4

The E.W. Scripps Company
Condensed Consolidated Statements of Cash Flows (Unaudited)

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | 2019
Cash Flows from Operating Activities: |  |  |  |
Net loss |  | $ | (11,809 | ) |  | $ | (6,814 | )
Adjustments to reconcile net loss to net cash flows from operating activities: |  |  |  |
Depreciation and amortization |  | 27,915 |  |  | 17,792 |
(Gain)/loss on sale of property and equipment |  | 1,433 |  |  | 173 |
Programming assets and liabilities |  | (28,834 | ) |  | (1,133 | )
Deferred income taxes |  | 14,672 |  |  | (4,341 | )
Stock and deferred compensation plans |  | 2,208 |  |  | 7,352 |
Pension expense, net of contributions |  | (4,034 | ) |  | (408 | )
Other changes in certain working capital accounts, net |  | 10,996 |  |  | (25,776 | )
Miscellaneous, net |  | 1,154 |  |  | (37 | )
Net cash provided by (used in) operating activities |  | 13,701 |  |  | (13,192 | )
Cash Flows from Investing Activities: |  |  |  |
Acquisitions, net of cash acquired |  | — |  |  | (55,199 | )
Acquisition of intangible assets |  | (525 | ) |  | (404 | )
Additions to property and equipment |  | (16,210 | ) |  | (13,440 | )
Purchase of investments |  | (3,087 | ) |  | (115 | )
Proceeds from FCC repack |  | 2,719 |  |  | 1,520 |
Miscellaneous, net |  | 773 |  |  | 1 |
Net cash used in investing activities |  | (16,330 | ) |  | (67,637 | )
Cash Flows from Financing Activities: |  |  |  |
Net borrowings under revolving credit facility |  | 175,000 |  |  | — |
Payments on long-term debt |  | (2,653 | ) |  | (750 | )
Dividends paid |  | (4,108 | ) |  | (4,040 | )
Repurchase of Class A Common shares |  | — |  |  | (584 | )
Tax payments related to shares withheld for vested stock and RSUs |  | (2,266 | ) |  | (3,649 | )
Miscellaneous, net |  | (16,574 | ) |  | (2,862 | )
Net cash provided by (used in) financing activities |  | 149,399 |  |  | (11,885 | )
Effect of foreign exchange rates on cash and cash equivalents |  | (111 | ) |  | 2 |
Increase (decrease) in cash and cash equivalents |  | 146,659 |  |  | (92,712 | )
Cash and cash equivalents: |  |  |  |
Beginning of year |  | 32,968 |  |  | 107,114 |
End of period |  | $ | 179,627 |  |  | $ | 14,402 |
Supplemental Cash Flow Disclosures |  |  |  |
Interest paid |  | $ | 24,833 |  |  | $ | 3,356 |
Income taxes paid |  | $ | 12 |  |  | $ | 50 |
Non-cash investing information |  |  |  |
Capital expenditures included in accounts payable |  | $ | 1,187 |  |  | $ | 1,465 |

See notes to condensed consolidated financial statements.
F-5

The E.W. Scripps Company
Condensed Consolidated Statements of Equity (Unaudited)

Three Months Ended March 31, 2020 and 2019 (in thousands, except per share data) |  | Common Stock |  | Additional Paid-in Capital |  | Retained Earnings (Accumulated Deficit) |  | Accumulated Other Comprehensive Income (Loss) ("AOCI") |  | Total Equity
As of December 31, 2019 |  | $ | 810 |  |  | $ | 1,117,095 |  |  | $ | (120,981 | ) |  | $ | (98,989 | ) |  | $ | 897,935 |
Comprehensive income (loss) |  | — |  |  | — |  |  | (11,809 | ) |  | 908 |  |  | (10,901 | )
Cash dividend: declared and paid - $0.05 per share |  | — |  |  | — |  |  | (4,108 | ) |  | — |  |  | (4,108 | )
Compensation plans: 429,273 net shares issued * |  | 4 |  |  | 2,390 |  |  | — |  |  | — |  |  | 2,394 |
As of March 31, 2020 |  | $ | 814 |  |  | $ | 1,119,485 |  |  | $ | (136,898 | ) |  | $ | (98,081 | ) |  | $ | 885,320 |

* Net of tax payments related to shares withheld for vested RSUs of $2,266 for the three months ended March 31, 2020.

As of December 31, 2018 |  | $ | 807 |  |  | $ | 1,106,984 |  |  | $ | (86,229 | ) |  | $ | (95,397 | ) |  | $ | 926,165 |
Comprehensive income (loss) |  | — |  |  | — |  |  | (6,814 | ) |  | 460 |  |  | (6,354 | )
Cash dividend: declared and paid - $0.05 per share |  | — |  |  | — |  |  | (4,040 | ) |  | — |  |  | (4,040 | )
Repurchase of 180,541 Class A Common shares |  | (2 | ) |  | (582 | ) |  | — |  |  | — |  |  | (584 | )
Compensation plans: 297,131 net shares issued * |  | 3 |  |  | 2,183 |  |  | — |  |  | — |  |  | 2,186 |
As of March 31, 2019 |  | $ | 808 |  |  | $ | 1,108,585 |  |  | $ | (97,083 | ) |  | $ | (94,937 | ) |  | $ | 917,373 |

* Net of tax payments related to shares withheld for vested RSUs of $3,649 for the three months ended March 31, 2019.
See notes to condensed consolidated financial statements.
F-6

The E.W. Scripps Company
Notes to Condensed Consolidated Financial Statements (Unaudited)
1. Summary of Significant Accounting Policies
As used in the Notes to Condensed Consolidated Financial Statements, the terms “Scripps,” “Company,” “we,” “our,” or “us” may, depending on the context, refer to The E.W. Scripps Company, to one or more of its consolidated subsidiary companies, or to all of them taken as a whole.
Basis of Presentation — The condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The interim financial statements should be read in conjunction with the audited consolidated financial statements, including the notes thereto included in our 2019 Annual Report on Form 10-K. In management's opinion, all adjustments (consisting of normal recurring accruals) necessary for a fair presentation of the interim periods have been made.
Results of operations are not necessarily indicative of the results that may be expected for future interim periods or for the full year. Additionally, certain amounts in prior periods have been reclassified to conform to the current period's presentation.
Principles of Consolidation — The consolidated financial statements include our accounts and those of our wholly-owned and majority-owned subsidiaries and variable interest entities (VIEs) for which we are the primary beneficiary. We are the primary beneficiary of a VIE when we have the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and have the obligation to absorb losses or the right to receive returns that would be significant to the VIE. Noncontrolling interest represents an owner’s share of the equity in certain of our consolidated entities. All intercompany transactions and account balances have been eliminated in consolidation.
Investments in entities over which we have significant influence but not control are accounted for using the equity method of accounting. Income from equity method investments represents our proportionate share of net income generated by equity method investees.
Nature of Operations — We are a diverse media enterprise, serving audiences and businesses through a portfolio of local television stations and national media brands. All of our businesses provide content and services via digital platforms, including the Internet, smartphones and tablets. Our media businesses are organized into the following reportable business segments: Local Media, National Media and Other. Additional information for our business segments is presented in the Notes to Condensed Consolidated Financial Statements.
Use of Estimates — Preparing financial statements in accordance with accounting principles generally accepted in the United States of America requires us to make a variety of decisions that affect the reported amounts and the related disclosures. Such decisions include the selection of accounting principles that reflect the economic substance of the underlying transactions and the assumptions on which to base accounting estimates. In reaching such decisions, we apply judgment based on our understanding and analysis of the relevant circumstances, including our historical experience, actuarial studies and other assumptions.
Our financial statements include estimates and assumptions used in accounting for our defined benefit pension plans; the periods over which long-lived assets are depreciated or amortized; the fair value of long-lived assets, goodwill and indefinite lived assets; the liability for uncertain tax positions and valuation allowances against deferred income tax assets; the fair value of assets acquired and liabilities assumed in business combinations; and self-insured risks.
While we re-evaluate our estimates and assumptions on an ongoing basis, actual results could differ from those estimated at the time of preparation of the financial statements.
Nature of Products and Services — The following is a description of principal activities from which we generate revenue.
Core Advertising — Core advertising is comprised of sales to local and national customers. The advertising includes a combination of broadcast air time, as well as digital advertising. Pricing of advertising time is based on audience size and share, the demographic of our audiences and the demand for our limited inventory of commercial time. Advertising time is sold through a combination of local sales staff and national sales representative firms. Digital revenues are primarily generated from the sale of advertising to local and national customers on our local television websites, smartphone apps, tablet apps and other platforms.
F-7

Political Advertising — Political advertising is generally sold through our Washington D.C. sales office. Advertising is sold to presidential, gubernatorial, Senate and House of Representative candidates, as well as for state and local issues. It is also sold to political action groups (PACs) or other advocacy groups.
Retransmission Revenues — We earn revenue from retransmission consent agreements with multi-channel video programming distributors (“MVPDs”) in our markets. The MVPDs are cable operators and satellite carriers who pay us to offer our programming to their customers. We also receive fees from over-the-top virtual MVPDs such as Hulu, YouTubeTV and AT&T Now. The fees we receive are typically based on the number of subscribers in our local market and the contracted rate per subscriber.
Other Products and Services — We derive revenue from sponsorships and community events through our Local Media segment. Our National Media segment offers subscription services for access to premium content to its customers. Our Triton business earns revenue from monthly fees charged to audio publishers for converting their content into digital audio streams and inserting digital advertising into those audio streams and providing statistical measurement information about their listening audience. Our podcast business acts as a sales and marketing representative and earns commission for its work.
Refer to Note 12. Segment Information for further information, including revenue by significant product and service offering.
Revenue Recognition — Revenue is measured based on the consideration we expect to be entitled to in exchange for promised goods or services provided to customers, and excludes any amounts collected on behalf of third parties. Revenue is recognized upon transfer of control of promised products or services to customers.
Advertising — Advertising revenue is recognized, net of agency commissions, over time primarily as ads are aired or impressions are delivered and any contracted audience guarantees are met. We apply the practical expedient to recognize revenue at the amount we have the right to invoice, which corresponds directly to the value a customer has received relative to our performance. For advertising sold based on audience guarantees, audience deficiency may result in an obligation to deliver additional advertisements to the customer. To the extent that we do not satisfy contracted audience ratings, we record deferred revenue until such time that the audience guarantee has been satisfied.
Retransmission — Retransmission revenues are considered licenses of functional intellectual property and are recognized at the point in time the content is transferred to the customer. MVPDs report their subscriber numbers to us generally on a 30- to 90-day lag. Prior to receiving the MVPD reporting, we record revenue based on estimates of the number of subscribers, utilizing historical levels and trends of subscribers for each MVPD.
Other — Revenues generated by our Triton business are recognized on a ratable basis over the contract term as the monthly service is provided to the customer.
Transaction Price Allocated to Remaining Performance Obligations — As of March 31, 2020, we had an aggregate transaction price of $53.2 million allocated to unsatisfied performance obligations related to contracts within our Triton business, most of which is expected to be recognized into revenue over the next 24 months.
We did not disclose the value of unsatisfied performance obligations on any other contracts with customers because they are either (i) contracts with an original expected term of one year or less, (ii) contracts for which the sales- or usage-based royalty exception was applied, or (iii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed.
Contract Balances — Timing of revenue recognition may differ from the timing of invoicing to customers. We record a receivable when revenue is recognized prior to invoicing, or unearned revenue when revenue is recognized subsequent to invoicing.
Payment terms may vary by contract type, although our terms generally include a requirement of payment within 30 to 90 days. In instances where the timing of revenue recognition differs from the timing of invoicing, we have determined our contracts do not include a significant financing component. The primary purpose of our invoicing terms is to provide customers with simplified and predictable ways of purchasing our products and services, not to receive financing from our customers.
The allowance for doubtful accounts reflects our best estimate of probable losses inherent in the accounts receivable balance. We estimate the allowance based on expected credit losses, including our historical experience of actual losses and known troubled accounts. The allowance for doubtful accounts totaled $4.0 million at March 31, 2020 and $3.5 million at December 31, 2019.
F-8

We record unearned revenue when cash payments are received in advance of our performance. We generally require amounts payable under advertising contracts with political advertising customers to be paid in advance. Unearned revenue totaled $8.6 million at March 31, 2020 and is expected to be recognized within revenue over the next 12 months. Unearned revenue totaled $11.7 million at December 31, 2019. We recorded $6.0 million of revenue in the three months ended March 31, 2020 that was included in unearned revenue at December 31, 2019.
Leases — We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities and operating lease liabilities in our condensed consolidated balance sheets.
ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As the implicit rate is not readily determinable for most of our leases, we use our incremental borrowing rate when determining the present value of lease payments. The incremental borrowing rate represents an estimate of the interest rate we would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of the lease. The operating lease ROU asset also includes any payments made at or before commencement and is reduced by any lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term.
Share-Based Compensation — We have a Long-Term Incentive Plan (the “Plan”) which is described more fully in our 2019 Annual Report on Form 10-K. The Plan provides for the award of incentive and nonqualified stock options, stock appreciation rights, restricted stock units (RSUs) and unrestricted Class A Common shares and performance units to key employees and non-employee directors.
Share-based compensation costs totaled $4.2 million and $5.8 million for the first quarter of 2020 and 2019, respectively.
Earnings Per Share (“EPS”) — Unvested awards of share-based payments with rights to receive dividends or dividend equivalents, such as our RSUs, are considered participating securities for purposes of calculating EPS. Under the two-class method, we allocate a portion of net income to these participating securities and, therefore, exclude that income from the calculation of EPS for common stock. We do not allocate losses to the participating securities.
The following table presents information about basic and diluted weighted-average shares outstanding:

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | 2019
Numerator (for basic and diluted earnings per share) |  |  |  |
Net loss |  | $ | (11,809 | ) |  | $ | (6,814 | )
Less income allocated to RSUs |  | — |  |  | — |
Numerator for basic and diluted earnings per share |  | $ | (11,809 | ) |  | $ | (6,814 | )
Denominator |  |  |  |
Basic weighted-average shares outstanding |  | 81,077 |  |  | 80,673 |
Effect of dilutive securities: |  |  |  |
Restricted stock units |  | — |  |  | — |
Diluted weighted-average shares outstanding |  | 81,077 |  |  | 80,673 |

For the three months ended March 31, 2020 and 2019, we incurred a net loss and the inclusion of RSUs would have been anti-dilutive. Accordingly, the diluted EPS calculation for the 2020 and 2019 periods excludes the effect from 2.2 million and 1.4 million of outstanding RSUs, respectively.
F-9

2. Recently Adopted and Issued Accounting Standards
Recently Adopted Accounting Standards — In December 2019, the Financial Accounting Standards Board ("FASB") issued new guidance that simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The guidance also clarifies and amends existing guidance in order to improve the consistent application of, and simplify GAAP for, other areas of Topic 740. It is effective for fiscal years beginning after December 15, 2020, with early adoption permitted. We elected to early adopt this standard effective January 1, 2020, with no material impact on our condensed consolidated financial statements.
In March 2019, the FASB issued new guidance to align the accounting for the costs of producing films and episodic television series in response to changes in production and distribution models in the media and entertainment industry. The new guidance amends the capitalization, amortization, impairment, presentation and disclosure requirements for entities that produce and own content, and also aligns the impairment guidance for licensed content to the owned content fair value model. This guidance applies to broadcasters and entities that produce and distribute films and episodic television series through both traditional mediums and digital mediums. We adopted the standard on January 1, 2020. Upon adoption, we recorded all licensed programming assets and programming assets produced by us as non-current assets in our condensed consolidated balance sheets as of March 31, 2020. Prepaid programming rights for the purchase of podcast content rights continue to be reported as current assets in our condensed consolidated balance sheets. The adoption of the standard had no material impact on our condensed consolidated statements of operations.
In August 2018, the FASB issued new guidance to address a customer's accounting for implementation costs incurred in a cloud computing arrangement ("CCA") that is a service contract. The new guidance aligns the accounting for costs incurred to implement a CCA that is a service arrangement with the guidance on capitalizing costs associated with developing or obtaining internal-use software. We adopted the standard on January 1, 2020, with no material impact on our condensed consolidated financial statements.
In June 2016, the FASB issued new guidance that changes the impairment model for most financial assets and certain other instruments. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, entities will be required to use a new forward-looking “expected loss” model that will replace today’s “incurred loss” model, which generally will result in the earlier recognition of allowances for losses. We adopted the standard on January 1, 2020. Considering current and expected future economic and market conditions related to COVID-19, we increased our allowances for accounts receivable $0.7 million. The adoption of the standard did not result in any other material impacts to our condensed consolidated financial statements and related disclosures.
Recently Issued Accounting Standards — In March 2020, the FASB issued new guidance that provides optional expedients and exceptions to certain accounting requirements to facilitate the transition away from the use of London Interbank Offered Rate (LIBOR) and other interbank offered rates. The guidance is effective as of March 12, 2020 and will apply through December 31, 2022 to all entities, subject to meeting certain criteria, that have contracts, hedging relationships and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. We will evaluate transactions or contract modifications occurring as a result of reference rate reform to determine whether to apply the optional guidance on an ongoing basis.
In August 2018, the FASB issued new guidance to add, remove and clarify annual disclosure requirements related to defined benefit pension and other postretirement plans. The guidance is effective for fiscal years ending after December 15, 2020 with early adoption permitted, and it should be applied on a retrospective basis. We believe the main impact of this guidance will be to no longer disclose the amount in accumulated other comprehensive income that is expected to be recognized as part of net periodic benefit cost over the next year. Additionally, we will have to add a narrative description for any significant gains and losses affecting the benefit obligation for the period. We are currently evaluating the impact of this guidance on our disclosures.
3. Acquisitions
Television Stations Acquisitions
On September 19, 2019, we closed on the acquisition of eight television stations in seven markets from the Nexstar Media Group, Inc. ("Nexstar") transaction with Tribune Media Company ("Tribune"). Cash consideration for the transaction totaled $582 million. Seven of the stations were operated by Tribune, and its subsidiaries, and one was operated by Nexstar. Nexstar was required to divest these stations in order to complete its acquisition of Tribune.
F-10

On May 1, 2019, we acquired 15 television stations in 10 markets from Cordillera Communications, LLC ("Cordillera"), for $521 million in cash, plus a working capital adjustment of $23.9 million.
Effective January 1, 2019, we acquired three television stations owned by Raycom Media ("Raycom") — Waco, Texas ABC affiliate KXXV/KRHD and Tallahassee, Florida ABC affiliate WTXL — for $55 million in cash. These stations were divested as part of Gray Television's acquisition of Raycom.
The following table summarizes the fair values of the Raycom, Cordillera and Nexstar-Tribune assets acquired and liabilities assumed at the closing dates. The allocation of purchase price for the Cordillera and Nexstar-Tribune acquisitions reflect preliminary fair values.

(in thousands) |  | Raycom |  | Cordillera |  | Nexstar- Tribune |  | Total
Accounts receivable |  | $ | — |  |  | $ | 26,264 |  |  | $ | — |  |  | $ | 26,264 |
Current portion of programming |  | — |  |  | — |  |  | 11,997 |  |  | 11,997 |
Other current assets |  | — |  |  | 986 |  |  | 3,541 |  |  | 4,527 |
Property and equipment |  | 11,721 |  |  | 53,734 |  |  | 61,909 |  |  | 127,364 |
Operating lease right-of-use assets |  | 296 |  |  | 4,667 |  |  | 82,447 |  |  | 87,410 |
Programming (less current portion) |  | — |  |  | — |  |  | 9,830 |  |  | 9,830 |
Goodwill |  | 18,349 |  |  | 254,176 |  |  | 167,322 |  |  | 439,847 |
Indefinite-lived intangible assets - FCC licenses |  | 6,800 |  |  | 26,700 |  |  | 176,000 |  |  | 209,500 |
Amortizable intangible assets: |  |  |  |  |  |  |  |
Television network affiliation relationships |  | 17,400 |  |  | 169,400 |  |  | 181,000 |  |  | 367,800 |
Advertiser relationships |  | 700 |  |  | 5,900 |  |  | 7,100 |  |  | 13,700 |
Other intangible assets |  | — |  |  | 13,000 |  |  | — |  |  | 13,000 |
Accounts payable |  | — |  |  | (15 | ) |  | — |  |  | (15 | )
Accrued expenses |  | — |  |  | (5,239 | ) |  | (4,580 | ) |  | (9,819 | )
Current portion of programming liabilities |  | — |  |  | — |  |  | (16,211 | ) |  | (16,211 | )
Other current liabilities |  | — |  |  | (280 | ) |  | (3,185 | ) |  | (3,465 | )
Operating lease liabilities |  | (296 | ) |  | (4,387 | ) |  | (79,766 | ) |  | (84,449 | )
Programming liabilities |  | — |  |  | — |  |  | (15,079 | ) |  | (15,079 | )
Net purchase price |  | $ | 54,970 |  |  | $ | 544,906 |  |  | $ | 582,325 |  |  | $ | 1,182,201 |

Of the value allocated to amortizable intangible assets, television network affiliation relationships have an estimated amortization period of 20 years, advertiser relationships have estimated amortization periods of 5-10 years and the value allocated to a shared services agreement has an estimated amortization period of 20 years.
The goodwill of $440 million arising from the transactions consists largely of synergies, economies of scale and other benefits of a larger broadcast footprint. We allocated the goodwill to our Local Media segment. We treated the transactions as asset acquisitions for income tax purposes resulting in a step-up in the assets acquired. The goodwill is deductible for income tax purposes.
Omny Studio
On June 10, 2019, we completed the acquisition of Omny Studio ("Omny") for a cash purchase price of $8.3 million. Omny is a Melbourne, Australia-based podcasting software-as-a-service company operating as a part of Triton in our National Media segment. Omny is an audio-on-demand platform built specifically for professional audio publishers. The platform enables audio publishers to seamlessly record, edit, distribute, monetize and analyze podcast content; replace static ads with dynamically inserted, highly targeted ads; and automates key aspects of campaign management, such as industry separation, frequency capping and volume normalization.
The preliminary purchase price allocation assigned $5.3 million to goodwill, $3.8 million to a developed technology intangible asset and the remainder was allocated to various working capital and deferred tax liability accounts. The developed
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technology intangible asset has an estimated amortization period of 10 years. The goodwill arising from the transaction consists largely of the fact that the addition of Omny's podcast and on-demand audio publishing platform to Triton's portfolio of streaming, advertising and measurement technologies provides audio publishers around the world with a full-stack enterprise solution to increase reach and revenue.
Pro forma results of operations
Pro forma results of operations, assuming the Cordillera and Nexstar-Tribune acquisitions had taken place at the beginning of 2019, are presented in the following table. The pro forma results do not include Raycom or Omny Studio, as the impact of these acquisitions, individually or in the aggregate, is not material to prior year results of operations. The pro forma information includes the historical results of operations of Scripps, Cordillera and Nexstar-Tribune, as well as adjustments for additional depreciation and amortization of the assets acquired, additional interest expense related to the financing of the transaction and other transactional adjustments. The pro forma results exclude the $1.2 million of transaction related costs that were expensed in conjunction with the acquisitions and do not include efficiencies, cost reductions or synergies expected to result from the acquisitions. The unaudited pro forma financial information is not necessarily indicative of the results that actually would have occurred had the acquisitions been completed at the beginning of the period.

(in thousands, except per share data) (unaudited) |  | Three Months Ended March 31, 2019
Operating revenues |  | $ | 384,304 |
Net loss |  | (19,930 | )
Net loss per share: |  |
Basic |  | $ | (0.25 | )
Diluted |  | (0.25 | )

4. Asset Write-Downs and Other Charges and Credits
Loss from operations before income taxes was affected by the following:
2020 - Acquisition and related integration costs of $4.9 million in the first quarter of 2020 reflect contract termination costs and professional service costs incurred to integrate the Cordillera and Nexstar-Tribune television stations.
2019 - Acquisition and related integration costs of $3.5 million in the first quarter of 2019 reflect professional service costs incurred to integrate Triton and the Raycom and Cordillera television stations, as well as costs related to the Nexstar-Tribune acquisition.
5. Income Taxes
We file a consolidated federal income tax return, consolidated unitary tax returns in certain states and other separate state income tax returns for our subsidiary companies.
The income tax provision for interim periods is generally determined based upon the expected effective income tax rate for the full year and the tax rate applicable to certain discrete transactions in the interim period. To determine the annual effective income tax rate, we must estimate both the total income (loss) before income tax for the full year and the jurisdictions in which that income (loss) is subject to tax. The actual effective income tax rate for the full year may differ from these estimates if income (loss) before income tax is greater than or less than what was estimated or if the allocation of income (loss) to jurisdictions in which it is taxed is different from the estimated allocations. We review and adjust our estimated effective income tax rate for the full year each quarter based upon our most recent estimates of income (loss) before income tax for the full year and the jurisdictions in which we expect that income will be taxed.
On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (the "CARES Act") was enacted and signed into law. The CARES Act includes several provisions for corporations including increasing the amount of deductible interest, allowing companies to carryback certain net operating losses (“NOLs”) and increasing the amount of NOLs that corporations can use to offset income. The CARES Act did not materially affect our first quarter income tax provision. We do expect to receive an additional tax refund of $13.9 million from the carryback of NOLs to prior periods. We are currently assessing the
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future implications of these provisions within the CARES Act on our condensed consolidated financial statements, but do not expect the impact to be material.
The effective income tax rate for the three months ended March 31, 2020 and 2019 was (7)% and 39%, respectively. Differences between our effective income tax rate and the U.S. federal statutory rate are the impact of state taxes, foreign taxes, non-deductible expenses, changes in reserves for uncertain tax positions and excess tax benefits or expense from the exercise and vesting of share-based compensation awards ($1.0 million expense in 2020 and $0.6 million benefit in 2019). Additionally, in the first quarter of 2020, we had a net discrete tax provision charge of $4.0 million related to state deferred rate changes and state NOL valuation allowance reductions.
Deferred tax assets totaled $11.6 million at March 31, 2020, which includes the tax effect of state NOL carryforwards. We recognize state NOL carryforwards as deferred tax assets, subject to valuation allowances. At each balance sheet date, we estimate the amount of carryforwards that are not expected to be used prior to expiration of the carryforward period. The tax effect of the carryforwards that are not expected to be used prior to their expiration is included in the valuation allowance.
6. Leases
We have operating leases for office space, data centers and certain equipment. Our leases have remaining lease terms of 1 year to 20 years, some of which may include options to extend the leases for up to 5 years, and some of which may include options to terminate the leases within 1 year. Operating lease costs recognized in our condensed consolidated statements of operations for the three months ended March 31, 2020 and 2019 totaled $5.6 million and $3.4 million, including short-term lease costs of $0.2 million and $0.1 million, respectively.
Other information related to our operating leases was as follows:

(in thousands, except lease term and discount rate) |  | As of March 31, 2020 |  | As of December 31, 2019
Balance Sheet Information |  |  |  |
Right-of-use assets |  | $ | 135,138 |  |  | $ | 138,640 |
Other current liabilities |  | 15,170 |  |  | 16,168 |
Operating lease liabilities |  | 121,947 |  |  | 123,739 |
Weighted Average Remaining Lease Term |  |  |  |
Operating leases |  | 11.95 years |  |  | 12.09 years |
Weighted Average Discount Rate |  |  |  |
Operating leases |  | 5.27 | % |  | 5.29 | %

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | 2019
Supplemental Cash Flows Information |  |  |  |
Cash paid for amounts included in the measurement of lease liabilities |  | $ | 5,031 |  |  | $ | 3,471 |
Right-of-use assets obtained in exchange for lease obligations |  | 929 |  |  | — |

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Future minimum lease payments under non-cancellable operating leases as of March 31, 2020 were as follows:

(in thousands) |  | Operating Leases
Remainder of 2020 |  | $ | 18,072 |
2021 |  | 13,553 |
2022 |  | 16,755 |
2023 |  | 16,886 |
2024 |  | 15,612 |
Thereafter |  | 105,413 |
Total future minimum lease payments |  | 186,291 |
Less: Imputed interest |  | (49,174 | )
Total |  | $ | 137,117 |

7. Goodwill and Other Intangible Assets
Goodwill consisted of the following:

(in thousands) |  | Local Media |  | National Media |  | Total
Gross balance as of December 31, 2019 |  | $ | 1,143,859 |  |  | $ | 395,313 |  |  | $ | 1,539,172 |
Accumulated impairment losses |  | (216,914 | ) |  | (50,403 | ) |  | (267,317 | )
Net balance as of December 31, 2019 |  | $ | 926,945 |  |  | $ | 344,910 |  |  | $ | 1,271,855 |
Gross balance as of March 31, 2020 |  | $ | 1,147,347 |  |  | $ | 395,297 |  |  | $ | 1,542,644 |
Accumulated impairment losses |  | (216,914 | ) |  | (50,403 | ) |  | (267,317 | )
Net balance as of March 31, 2020 |  | $ | 930,433 |  |  | $ | 344,894 |  |  | $ | 1,275,327 |

Other intangible assets consisted of the following:

(in thousands) |  | As of March 31, 2020 |  | As of December 31, 2019
Amortizable intangible assets: |  |  |  |
Carrying amount: |  |  |  |
Television network affiliation relationships |  | $ | 616,244 |  |  | $ | 616,244 |
Customer lists and advertiser relationships |  | 111,700 |  |  | 111,700 |
Other |  | 109,281 |  |  | 109,156 |
Total carrying amount |  | 837,225 |  |  | 837,100 |
Accumulated amortization: |  |  |  |
Television network affiliation relationships |  | (90,872 | ) |  | (82,917 | )
Customer lists and advertiser relationships |  | (51,419 | ) |  | (48,586 | )
Other |  | (33,058 | ) |  | (29,721 | )
Total accumulated amortization |  | (175,349 | ) |  | (161,224 | )
Net amortizable intangible assets |  | 661,876 |  |  | 675,876 |
Indefinite-lived intangible assets — FCC licenses |  | 385,915 |  |  | 385,915 |
Total other intangible assets |  | $ | 1,047,791 |  |  | $ | 1,061,791 |

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Estimated amortization expense of intangible assets for each of the next five years is $43.3 million for the remainder of 2020, $55.2 million in 2021, $49.8 million in 2022, $44.7 million in 2023, $42.9 million in 2024, $40.0 million in 2025 and $386.0 million in later years.
Goodwill and other indefinite-lived intangible assets are tested for impairment annually and any time events occur or changes in circumstances indicate it is more likely than not the fair value of a reporting unit, or respective indefinite-lived intangible asset, is below its carrying value. Our reporting units are Local Media, Katz, Triton, Stitcher and Newsy. Such events or changes in circumstances include, but are not limited to, changes in business climate, declines in the price of our stock, or other factors resulting in lower cash flow related to such assets. If the carrying amount exceeds its fair value, then an impairment loss is recognized.
Weakness in economic conditions toward the end of the first quarter, reflecting the impact of the COVID-19 pandemic, and declines in our stock price, created indications of fair value declines for our reporting units as of March 31, 2020. Accordingly, during the quarter, we considered impacts to the estimated fair values for each of our reporting units to determine if it was more likely than not that fair value had declined below carrying value. Our analysis primarily relied upon market data and discounted cash flow analyses. The use of a discounted cash flow approach requires significant judgment to estimate future cash flows of the business and the period of time over which those cash flows will occur, as well as to determine an appropriate discount rate. While we believe the estimates and judgments used in the discounted cash flow analyses for our reporting units were appropriate, different assumptions with respect to future cash flows, long-term growth rates and discount rates, could produce different estimates of value.
We concluded that it was not more likely than not that the carrying value for any of our reporting units exceeded its fair value. However, the discounted cash flow values for each of our reporting units were lower than the values determined during our 2019 annual impairment test. In 2019, the fair value for our Local Media reporting unit exceeded its carrying value by approximately 25% and our other reporting units exceeded their carrying values by over 30%. The Local Media reporting unit has $0.9 billion of goodwill or 73% of the consolidated total for the Company.
We also concluded that it was not more likely than not that the carrying value of any of our FCC licenses exceeded their fair values. Our FCC licenses are indefinite-lived assets that are not subject to amortization. The value of a FCC license is estimated using an income approach, which requires multiple assumptions relating to the future prospects of each individual FCC license. While we believe the estimates and judgments used in determining that it was not more likely than not that the carrying values of the FCC licenses exceeded fair values were appropriate, different assumptions with respect to the income approach could produce different estimates of value. For example, as it relates to our 2019 annual impairment test, a 50-basis point increase in discount rates would reduce the aggregate fair value of the FCC licenses by approximately $65 million.
8. Long-Term Debt
Long-term debt consisted of the following:

(in thousands) |  | As of March 31, 2020 |  | As of December 31, 2019
Revolving credit facility |  | $ | 175,000 |  |  | $ | — |
Senior unsecured notes, due in 2025 |  | 400,000 |  |  | 400,000 |
Senior unsecured notes, due in 2027 |  | 500,000 |  |  | 500,000 |
Term loan, due in 2024 |  | 292,500 |  |  | 293,250 |
Term loan, due in 2026 |  | 757,369 |  |  | 759,272 |
Total outstanding principal |  | 2,124,869 |  |  | 1,952,522 |
Less: Debt issuance costs and issuance discounts |  | (36,025 | ) |  | (37,492 | )
Less: Current portion |  | (10,612 | ) |  | (10,612 | )
Net carrying value of long-term debt |  | $ | 2,078,232 |  |  | $ | 1,904,418 |
Fair value of long-term debt * |  | $ | 1,979,412 |  |  | $ | 1,991,164 |

* Fair values of the 2025 and 2027 Senior Notes are estimated based on quoted private market transactions and are classified as Level 1 in the fair value hierarchy. The fair values of the term loans are based on observable estimates provided by third party financial professionals, and as such, are classified within Level 2 of the fair value hierarchy.
2025 Senior Unsecured Notes
On April 28, 2017, we issued $400 million senior unsecured notes ("the 2025 Senior Notes"), which bear interest at a rate of 5.125% per annum and mature on May 15, 2025. The 2025 Senior Notes were priced at 100% of par value and interest is payable semi-annually on May 15 and November 15. Prior to May 15, 2020, we may redeem the 2025 Senior Notes, in whole or in part, at any time, or from time to time, at a price equal to 100% of the principal amount of the 2025 Senior Notes, plus accrued and unpaid interest, if any, to the date of redemption, plus a “make-whole” premium, as set forth in the 2025 Senior Notes indenture. In addition, on or prior to May 15, 2020, we may redeem up to 40% of the 2025 Senior Notes, using proceeds of equity offerings. If we sell certain of our assets or have a change of control, the holders of the 2025 Senior Notes may require us to repurchase some or all of the notes. The 2025 Senior Notes are also guaranteed by us and the majority of our subsidiaries. The 2025 Senior Notes contain covenants that, among other things, limit the ability to incur additional debt, make certain restricted payments, and/or create liens, that are typical for borrowing transactions of this nature.
We incurred approximately $7.0 million of deferred financing costs in connection with the issuance of the 2025 Senior Notes, which are being amortized over the life of the notes.
2027 Senior Unsecured Notes
On July 26, 2019, our wholly-owned subsidiary, Scripps Escrow, Inc. ("Scripps Escrow"), issued $500 million of senior unsecured notes, which bear interest at a rate of 5.875% per annum and mature on July 15, 2027 ("the 2027 Senior Notes"). The 2027 Senior Notes were priced at 100% of par value and interest is payable semi-annually on July 15 and January 15, commencing on January 15, 2020. Prior to July 15, 2022, we may redeem up to 40% of the aggregate principal amount of the 2027 Senior Notes at a redemption price of 105.875% of the principal amount plus accrued and unpaid interest, if any, to the date of redemption. We may also redeem some or all of the notes before 2022 at a redemption price of 100% of the principal amount, plus accrued and unpaid interest, if any, to the redemption date. If we sell certain of our assets or have a change of control, the holders of the 2027 Senior Notes may require us to repurchase some or all of the notes. The 2027 Senior Notes are fully and unconditionally guaranteed on a senior unsecured basis by certain of our existing and future domestic restricted subsidiaries. The 2027 Senior Notes contain covenants that, among other things, limit the ability to incur additional debt, make certain restricted payments, and/or create liens, that are typical for borrowing transactions of this nature. There are no registration rights associated with the 2027 Senior Notes.
We incurred approximately $10.7 million of deferred financing costs in connection with the issuance of the 2027 Senior Notes, which are being amortized over the life of the notes.
Scripps Senior Secured Credit Agreement
On October 2, 2017, we issued a $300 million term loan B which matures in October 2024 ("2024 term loan"). We amended the term loan on April 4, 2018, reducing the interest rate by 25 basis points. Following the amendment, interest is payable on the 2024 term loan at a rate based on LIBOR, plus a fixed margin of 2.00%. Interest will reduce to a rate of LIBOR plus a fixed margin of 1.75% if the Company’s total net leverage, as defined by the amended agreement, is below 2.75. The 2024 term loan requires annual principal payments of $3 million.
As of March 31, 2020 and December 31, 2019, the interest rate on the 2024 term loan was 2.99% and 3.80%, respectively. The weighted-average interest rate was 3.67% and 4.50% for the three months ended March 31, 2020 and 2019, respectively.
On May 1, 2019, we entered into a Fourth Amendment to the Third Amended and Restated Credit Agreement ("Fourth Amendment"). Under the Fourth Amendment, we issued a $765 million term loan B ("2026 term loan") that matures in May 2026 with interest payable at rates based on LIBOR, plus a fixed margin of 2.75%. We amended this term loan on December 18, 2019, reducing the interest rate by 25 basis points. Following the amendment, interest is payable on the 2026 term loan at a rate based on LIBOR, plus a fixed margin of 2.50%. The 2026 term loan requires annual principal payments of $7.6 million. Deferred financing costs and original issuance discount totaled approximately $23.0 million with this term loan, which are being amortized over the life of the loan.
As of March 31, 2020 and December 31, 2019, the interest rate on the 2026 term loan was 3.49% and 4.30%, respectively. The weighted-average interest rate on the term loan was 4.17% for the three months ended March 31, 2020.
We have a $210 million revolving credit facility ("Revolving Credit Facility") that expires in April 2022. Commitment fees of 0.30% to 0.50% per annum, based on our leverage ratio, of the total unused commitment are payable under the Revolving Credit Facility. Interest is payable on the Revolving Credit Facility at rates based on LIBOR, plus a margin based on our leverage ratio, ranging from 1.75% to 2.50%. As of March 31, 2020, we had $175 million outstanding under the Revolving Credit Facility with an interest rate of 3.03%. The weighted-average interest rate over the period during which we had a drawn revolver balance in 2020 was 3.73%. As of March 31, 2020 and December 31, 2019, we had outstanding letters of credit totaling $6.8 million and $6.0 million, respectively, under the Revolving Credit Facility.
The Senior Secured Credit Agreement contains covenants that limit our ability to incur additional debt and provide for restrictions on certain payments (dividends and share repurchases). Additionally, we must be in compliance with certain leverage ratios in order to proceed with acquisitions. Our credit agreement also includes a provision that in certain circumstances we must use a portion of excess cash flow to repay debt. We granted the lenders pledges of our equity interests in our subsidiaries and security interests in substantially all other personal property including cash, accounts receivables and equipment. In addition, the Revolving Credit Facility contains a covenant to comply with a maximum first lien net leverage ratio of 4.5 to 1.0 when we have outstanding borrowings on the facility. As of March 31, 2020, we were in compliance with our financial covenants.
9. Other Liabilities
Other liabilities consisted of the following:

(in thousands) |  | As of March 31, 2020 |  | As of December 31, 2019
Employee compensation and benefits |  | $ | 19,795 |  |  | $ | 21,403 |
Deferred FCC repack income |  | 38,720 |  |  | 36,770 |
Programming liability |  | 47,912 |  |  | 57,291 |
Liability for pension benefits |  | 184,912 |  |  | 190,219 |
Other |  | 9,991 |  |  | 10,265 |
Other liabilities (less current portion) |  | $ | 301,330 |  |  | $ | 315,948 |

10. Supplemental Cash Flow Information
The following table presents additional information about the change in certain working capital accounts:

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | 2019
Accounts receivable |  | $ | 12,158 |  |  | $ | 4,031 |
Other current assets |  | (11,569 | ) |  | (4,812 | )
Accounts payable |  | 14,032 |  |  | 4,539 |
Accrued employee compensation and benefits |  | (14,813 | ) |  | (22,399 | )
Accrued interest |  | (1,172 | ) |  | 5,124 |
Other accrued liabilities |  | 14,603 |  |  | (4,789 | )
Unearned revenue |  | (3,106 | ) |  | (3,339 | )
Other, net |  | 863 |  |  | (4,131 | )
Total |  | $ | 10,996 |  |  | $ | (25,776 | )

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11. Employee Benefit Plans
We sponsor a noncontributory defined benefit pension plan and non-qualified Supplemental Executive Retirement Plans ("SERPs"). The accrual for future benefits has been frozen in our defined benefit pension plan and SERPs.
We sponsor a defined contribution plan covering substantially all non-union and certain union employees. We match a portion of employees' voluntary contributions to this plan.
Other union-represented employees are covered by defined benefit pension plans jointly sponsored by us and the union, or by union-sponsored multi-employer plans.
The components of the employee benefit plans expense consisted of the following:

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | 2019
Interest cost |  | $ | 4,917 |  |  | $ | 5,800 |
Expected return on plan assets, net of expenses |  | (5,256 | ) |  | (5,058 | )
Amortization of actuarial loss and prior service cost |  | 1,125 |  |  | 572 |
Total for defined benefit pension plan |  | 786 |  |  | 1,314 |
Multi-employer plans |  | 9 |  |  | 41 |
SERPs |  | 240 |  |  | 258 |
Defined contribution plan |  | 3,779 |  |  | 2,995 |
Net periodic benefit cost |  | $ | 4,814 |  |  | $ | 4,608 |

We contributed $0.3 million to fund current benefit payments for our SERPs and $4.8 million for our defined benefit pension plan during the three months ended March 31, 2020. During the remainder of 2020, we anticipate contributing an additional $1.0 million to fund the SERPs' benefit payments. We are required to contribute an additional $27.0 million to fund our qualified defined benefit pension plan in order to meet our 2020 funding requirements under the provisions of the Pension Funding Equity Act of 2004 and the Pension Protection Act of 2006. In response to COVID-19, President Donald Trump signed into law the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”). The CARES Act provides a provision to defer 2020 pension contributions until January 1, 2021. We anticipate delaying the payment of 2020 pension contributions in accordance with the CARES Act provision.
12. Segment Information
We determine our business segments based upon our management and internal reporting structures, as well as the basis on which our chief operating decision maker makes resource-allocation decisions. We report our financial performance based on the following segments: Local Media, National Media, Other.
Our Local Media segment includes our 60 local broadcast stations and their related digital operations. It is comprised of 18 ABC affiliates, 11 NBC affiliates, nine CBS affiliates and four FOX affiliates. We also have 13 CW affiliates - five on full power stations and eight on multicast; two MyNetworkTV affiliates; two independent stations and nine additional low power stations. Our Local Media segment earns revenue primarily from the sale of advertising to local, national and political advertisers and retransmission fees received from cable operators, telecommunications companies and satellite carriers. We also receive retransmission fees from over-the-top virtual MVPDs such as Hulu, YouTubeTV and AT&T Now.
Our National Media segment includes our collection of national brands. Our national brands include Katz, Stitcher and its advertising network Midroll Media (Midroll), Newsy, Triton and other national brands. These operations earn revenue primarily through the sale of advertising.
We allocate a portion of certain corporate costs and expenses, including information technology, certain employee benefits and shared services, to our business segments. The allocations are generally amounts agreed upon by management, which may differ from an arms-length amount.
Our chief operating decision maker evaluates the operating performance of our business segments and makes decisions about the allocation of resources to our business segments using a measure called segment profit. Segment profit excludes
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interest, defined benefit pension plan expense, income taxes, depreciation and amortization, impairment charges, divested operating units, restructuring activities, investment results and certain other items that are included in net income (loss) determined in accordance with accounting principles generally accepted in the United States of America.
Information regarding our business segments is as follows:

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | 2019
Segment operating revenues: |  |  |  |
Local Media |  | $ | 321,804 |  |  | $ | 203,387 |
National Media |  | 107,602 |  |  | 87,317 |
Other |  | 1,500 |  |  | 1,459 |
Total operating revenues |  | $ | 430,906 |  |  | $ | 292,163 |
Segment profit (loss): |  |  |  |
Local Media |  | $ | 55,977 |  |  | $ | 34,173 |
National Media |  | 11,785 |  |  | 4,941 |
Other |  | (170 | ) |  | (433 | )
Shared services and corporate |  | (18,654 | ) |  | (16,158 | )
Acquisition and related integration costs |  | (4,910 | ) |  | (3,480 | )
Restructuring costs |  | — |  |  | (938 | )
Depreciation and amortization of intangible assets |  | (27,915 | ) |  | (17,792 | )
Gains (losses), net on disposal of property and equipment |  | (1,433 | ) |  | (173 | )
Interest expense |  | (25,798 | ) |  | (8,916 | )
Defined benefit pension plan expense |  | (1,026 | ) |  | (1,572 | )
Miscellaneous, net |  | 1,114 |  |  | (800 | )
Loss from operations before income taxes |  | $ | (11,030 | ) |  | $ | (11,148 | )
Depreciation: |  |  |  |
Local Media |  | $ | 11,490 |  |  | $ | 7,591 |
National Media |  | 1,620 |  |  | 1,004 |
Other |  | 37 |  |  | 38 |
Shared services and corporate |  | 381 |  |  | 342 |
Total depreciation |  | $ | 13,528 |  |  | $ | 8,975 |
Amortization of intangible assets: |  |  |  |
Local Media |  | $ | 9,921 |  |  | $ | 3,958 |
National Media |  | 4,128 |  |  | 4,521 |
Shared services and corporate |  | 338 |  |  | 338 |
Total amortization of intangible assets |  | $ | 14,387 |  |  | $ | 8,817 |
Additions to property and equipment: |  |  |  |
Local Media |  | $ | 14,441 |  |  | $ | 9,480 |
National Media |  | 1,854 |  |  | 4,290 |
Other |  | 5 |  |  | 31 |
Shared services and corporate |  | 114 |  |  | 411 |
Total additions to property and equipment |  | $ | 16,414 |  |  | $ | 14,212 |

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A disaggregation of the principal activities from which we generate revenue is as follows:

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | 2019
Operating revenues: |  |  |  |
Core advertising |  | $ | 240,994 |  |  | $ | 173,361 |
Political |  | 18,720 |  |  | 880 |
Retransmission and carriage |  | 138,950 |  |  | 87,283 |
Other |  | 32,242 |  |  | 30,639 |
Total operating revenues |  | $ | 430,906 |  |  | $ | 292,163 |

13. Capital Stock
Capital Stock — We have two classes of common shares, Common Voting shares and Class A Common shares. The Class A Common shares are only entitled to vote on the election of the greater of three or one-third of the directors and other matters as required by Ohio law.
Share Repurchase Plan — Shares may be repurchased from time to time at management's discretion. Shares can be repurchased under an authorization via open market purchases or privately negotiated transactions, including accelerated stock repurchase transactions, block trades, or pursuant to trades intending to comply with Rule 10b5-1 of the Securities Exchange Act of 1934. In November 2016, our Board of Directors authorized a repurchase program of up to $100 million of our Class A Common shares. We repurchased a total of $50.3 million of shares under this authorization prior to its expiration on March 1, 2020. In February 2020, our Board of Directors authorized a new share repurchase program of up to $100 million of our Class A Common shares through March 1, 2022. No shares were repurchased under either authorization during the first quarter of 2020. During the three months ended March 31, 2019, we repurchased $0.6 million of shares at prices ranging from $15.54 to $18.72 per share.
14. Accumulated Other Comprehensive Income (Loss)
Changes in accumulated other comprehensive income (loss) ("AOCI") by component, including items reclassified out of AOCI, were as follows:

|  | Three Months Ended March 31, 2020
(in thousands) |  | Defined Benefit Pension Items |  | Other |  | Total
Beginning balance, December 31, 2019 |  | $ | (98,734 | ) |  | $ | (255 | ) |  | $ | (98,989 | )
Other comprehensive income (loss) before reclassifications |  | — |  |  | — |  |  | — |
Amounts reclassified from AOCI, net of tax of $286(a) |  | 902 |  |  | 6 |  |  | 908 |
Net current-period other comprehensive income (loss) |  | 902 |  |  | 6 |  |  | 908 |
Ending balance, March 31, 2020 |  | $ | (97,832 | ) |  | $ | (249 | ) |  | $ | (98,081 | )

|  | Three Months Ended March 31, 2019
(in thousands) |  | Defined Benefit Pension Items |  | Other |  | Total
Beginning balance, December 31, 2018 |  | $ | (95,365 | ) |  | $ | (32 | ) |  | $ | (95,397 | )
Other comprehensive income (loss) before reclassifications |  | — |  |  | — |  |  | — |
Amounts reclassified from AOCI, net of tax of $155(a) |  | 460 |  |  | — |  |  | 460 |
Net current-period other comprehensive income (loss) |  | 460 |  |  | — |  |  | 460 |
Ending balance, March 31, 2019 |  | $ | (94,905 | ) |  | $ | (32 | ) |  | $ | (94,937 | )

(a) Actuarial gain (loss) is included in defined benefit pension plan expense in the condensed consolidated statements of operations
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
This discussion and analysis of financial condition and results of operations is based upon the Condensed Consolidated Financial Statements and the Notes to Condensed Consolidated Financial Statements. You should read this discussion in conjunction with those financial statements.
Forward-Looking Statements
This document contains certain forward-looking statements related to the Company's businesses that are based on management’s current expectations. Forward-looking statements are subject to certain risks, trends and uncertainties, including changes in advertising demand and other economic conditions that could cause actual results to differ materially from the expectations expressed in forward-looking statements. Such forward-looking statements are made as of the date of this document and should be evaluated with the understanding of their inherent uncertainty. A detailed discussion of principal risks and uncertainties that may cause actual results and events to differ materially from such forward-looking statements is included in the section titled “Risk Factors.” Such Risk Factors include the potential materially adverse impact of the COVID-19 pandemic on the Company’s financial results or condition as a result of financial market volatility, government and regulatory actions, and disruptions to the Company’s businesses. The Company undertakes no obligation to publicly update any forward-looking statements to reflect events or circumstances after the date the statement is made.
Executive Overview
The E.W. Scripps Company (“Scripps”) is a diverse media enterprise, serving audiences and businesses through a portfolio of local and national media brands. We are the fourth-largest independent owner of local television stations, with 60 stations in 42 markets that reach about 31% of U.S. television households. We have affiliations with all of the “Big Four” television networks as well as the CW and MyNetworkTV networks. In our National Media division, we operate national brands including podcast industry-leader Stitcher and its advertising network Midroll Media; next-generation national news network Newsy; five national multicast networks - Bounce, Grit, Laff, Court TV and Court TV Mystery - that make up the Katz Networks; and Triton, a global leader in digital audio technology and measurement services. We also operate an award-winning investigative reporting newsroom in Washington, D.C., and serve as the longtime steward of one of the nation's largest, most successful and longest-running educational programs, the Scripps National Spelling Bee.
During the first quarter of 2020, an outbreak of the coronavirus that causes the disease COVID-19 was declared a pandemic by the World Health Organization. As the United States began to combat the crisis, the Company identified three priorities to guide its actions: maintaining the health and well-being of its employees; serving its audiences and communities; and maintaining business continuity. By mid-March, we had transitioned nearly all of our employees out of our workplaces without the interruption of news programming or other media delivery.
The full impact of COVID-19 is unknown and rapidly evolving. The outbreak and any preventative or protective actions that the Company, its vendors or its customers may take in respect of this virus may result in a period of disruption that could potentially impact our operations, financial results and financial condition. We estimate that our consolidated revenues were impacted by about $10 million in the first quarter of 2020. The extent to which COVID-19 impacts our results and financial condition in future periods depends on future developments that we cannot predict, including new information that may emerge concerning the severity of COVID-19 and the actions to contain the virus or treat its impact, among others. As media has been designated an essential business, we have implemented work from home procedures, including for newscast production, to continue our operations without disruption. We have seen increases in viewership at our broadcast television stations but do not anticipate that these positive audience trends will offset the loss of advertising revenue resulting from the downturn in the economy. In order to preserve liquidity in response to this changing environment, we also have undertaken a number of cost saving initiatives through reductions in capital expenses, hiring freezes, freezes on 2020 merit pay raises, reduced executive pay and Board of Directors’ fees, and other general expense reductions in areas of travel, entertainment and marketing. These initiatives are expected to provide cash savings of more than $85 million for the full year, approximately $75 million of which will be in the last three quarters of 2020. We will continue to evaluate and quantify the impact of COVID-19 on our consolidated financial statements.
In response to COVID-19, President Donald Trump signed into law the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”) on March 27, 2020. The CARES Act provides a number of provisions intended to support the economy and business operations, including the deferral of 2020 pension contributions to 2021, the temporary suspension of certain payment requirements for the employer portion of Social Security taxes, temporary changes regarding the prior and future utilization of net operating losses, temporary changes to the prior and future limitations on interest deductions, technical corrections from prior tax legislation for tax depreciation of certain qualified improvement property and the creation of certain
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refundable employee retention credits. We anticipate benefiting from deferring $27 million in pension contributions to 2021, deferring $17 million of Social Security tax payments beyond 2020, and receiving an additional tax refund of $13.9 million from the carryback of net operating losses to prior periods. We are also continuing to evaluate the other provisions of the CARES Act on our consolidated financial statements and have not yet quantified what material impacts to the financial statements (if any) may result.
Due to the current uncertainty in the global economy resulting from the COVID-19 pandemic, we also took measures to preserve the Company's financial flexibility. During the first quarter of 2020, we drew $175 million under our $210 million revolving credit facility. We are also evaluating government-supported programs intended to facilitate lending to small and medium-sized businesses. Based upon expected financial results, our cost saving initiatives, the stimulus provisions under the CARES Act, as well as about $10 million of expected interest savings from declines in LIBOR interest rates, we currently anticipate having sufficient liquidity for navigating the next 12 months. Our term loans and unsecured notes do not have maintenance covenants, and our revolving credit facility has a leverage ratio covenant, that only applies when there are outstanding borrowings under the facility. While we believe we currently have sufficient liquidity and will remain in compliance with our revolving credit covenant, in the event of a prolonged period of economic weakness there are additional cost saving initiatives we could undertake that would further enhance our liquidity.
Results of Operations
The trends and underlying economic conditions affecting the operating performance and future prospects differ for each of our business segments. Accordingly, you should read the following discussion of our consolidated results of operations in conjunction with the discussion of the operating performance of our business segments that follows.
Consolidated Results of Operations
Consolidated results of operations were as follows:

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | Change |  | 2019
Operating revenues |  | $ | 430,906 |  |  | 47.5 | % |  | $ | 292,163 |
Employee compensation and benefits |  | (149,919 | ) |  | 36.0 | % |  | (110,203 | )
Programming |  | (144,969 | ) |  | 47.9 | % |  | (97,995 | )
Other expenses |  | (87,080 | ) |  | 41.7 | % |  | (61,442 | )
Acquisition and related integration costs |  | (4,910 | ) |  |  |  | (3,480 | )
Restructuring costs |  | — |  |  |  |  | (938 | )
Depreciation and amortization of intangible assets |  | (27,915 | ) |  |  |  | (17,792 | )
Gains (losses), net on disposal of property and equipment |  | (1,433 | ) |  |  |  | (173 | )
Operating income |  | 14,680 |  |  |  |  | 140 |
Interest expense |  | (25,798 | ) |  |  |  | (8,916 | )
Defined benefit pension plan expense |  | (1,026 | ) |  |  |  | (1,572 | )
Miscellaneous, net |  | 1,114 |  |  |  |  | (800 | )
Loss from operations before income taxes |  | (11,030 | ) |  |  |  | (11,148 | )
(Provision) benefit for income taxes |  | (779 | ) |  |  |  | 4,334 |
Net loss |  | $ | (11,809 | ) |  |  |  | $ | (6,814 | )

On September 19, 2019, we acquired eight television stations from the Nexstar-Tribune transaction, and on May 1, 2019, we acquired 15 television stations from Cordillera. These are referred to as the "acquired stations" in the discussion that follows. The inclusion of operating results from these businesses for the periods subsequent to their acquisition impacts the comparability of our consolidated and segment operating results.
Operating revenues increased $139 million or 47% for the first three months of 2020 when compared to the prior period. Excluding the acquired stations, operating revenues increased 15%. Higher political advertising revenue and retransmission revenue in our Local Media group and overall growth within our National Media businesses contributed to the remainder of the increase. Weakness in economic conditions toward the end of the first quarter, reflecting the impact of the COVID-19
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pandemic, negatively affected spending from our advertisers. We estimate that our consolidated revenues, primarily at Local Media, were impacted by about $10 million in the first quarter of 2020. While we face a period of uncertainty regarding the duration of the pandemic and the extent of the impact on our operations, we do expect that revenue will continue to be under pressure for the remainder of 2020. We do not expect revenue from retransmission fees, political advertising and subscription fees to be significantly impacted by the economic downturn, which accounts for about 50% of our consolidated revenue.
Employee compensation and benefits increased $39.7 million or 36% for the first three months of 2020 when compared to the prior period. Excluding the acquired stations, employee compensation and benefits increased 5.8% in the quarter due to the annual merit increase that occurred in March 2019, as well as expansion of our National Media group throughout 2019.
Programming expense increased $47.0 million or 48% in the first three months of 2020 when compared to the prior period. Excluding the acquired stations, programming expense increased 20% in the quarter due to higher network affiliation fees at our stations, reflecting contractual rate increases, as well as an increase in programming costs associated with our National Media businesses, Katz and Stitcher.
Other expenses increased $25.6 million or 42% in the first three months of 2020 when compared to the prior period. Excluding the acquired stations, other expenses increased 12% in the quarter, primarily driven by increases in rating service costs as well as marketing and promotion costs for our national brands.
Acquisition and related integration costs of $4.9 million incurred during the first three months of 2020 reflect contract termination costs and professional service costs incurred to integrate the Cordillera and Nexstar-Tribune television stations.
For the three months ended 2019, restructuring costs were $0.9 million. These restructuring charges reflect severance, outside consulting fees and other costs associated with our previously announced changes in management and operating structure.
Depreciation and amortization of intangible assets increased from $17.8 million in 2019 to $27.9 million in 2020 due to the acquired stations.
Interest expense increased in 2020 due to the issuance of a $765 million term loan B in May 2019 and issuance of $500 million of senior unsecured notes in July 2019 in order to fund the Cordillera and Nexstar-Tribune acquisitions.
The effective income tax rate was (7)% and 39% for the three months ended March 31, 2020 and 2019, respectively. Other differences between our effective income tax rate and the U.S. federal statutory rate are the impact of state taxes, foreign taxes, non-deductible expenses, changes in reserves for uncertain tax positions and excess tax benefits or expense from the exercise and vesting of share-based compensation awards ($1.0 million expense in 2020 and $0.6 million benefit in 2019). Additionally, in the first quarter of 2020, we had a net discrete tax provision charge of $4.0 million related to state deferred rate changes and state net operating loss valuation allowance reductions.
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Business Segment Results — As discussed in the Notes to Condensed Consolidated Financial Statements, our chief operating decision maker evaluates the operating performance of our business segments using a measure called segment profit. Segment profit excludes interest, defined benefit pension plan expense, income taxes, depreciation and amortization, impairment charges, divested operating units, restructuring activities, investment results and certain other items that are included in net income (loss) determined in accordance with accounting principles generally accepted in the United States of America.
Items excluded from segment profit generally result from decisions made in prior periods or from decisions made by corporate executives rather than the managers of the business segments. Depreciation and amortization charges are the result of decisions made in prior periods regarding the allocation of resources and are, therefore, excluded from the measure. Generally, our corporate executives make financing, tax structure and divestiture decisions. Excluding these items from measurement of our business segment performance enables us to evaluate business segment operating performance based upon current economic conditions and decisions made by the managers of those business segments in the current period.
We allocate a portion of certain corporate costs and expenses, including information technology, certain employee benefits and shared services to our business segments. The allocations are generally amounts agreed upon by management, which may differ from an arms-length amount. Corporate assets are primarily cash and cash equivalents, restricted cash, property and equipment primarily used for corporate purposes and deferred income taxes.
Information regarding the operating performance of our business segments and a reconciliation of such information to the condensed consolidated financial statements is as follows:

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | Change |  | 2019
Segment operating revenues: |  |  |  |  |  |
Local Media |  | $ | 321,804 |  |  | 58.2 | % |  | $ | 203,387 |
National Media |  | 107,602 |  |  | 23.2 | % |  | 87,317 |
Other |  | 1,500 |  |  | 2.8 | % |  | 1,459 |
Total operating revenues |  | $ | 430,906 |  |  | 47.5 | % |  | $ | 292,163 |
Segment profit (loss): |  |  |  |  |  |
Local Media |  | $ | 55,977 |  |  | 63.8 | % |  | $ | 34,173 |
National Media |  | 11,785 |  |  |  |  |  | 4,941 |
Other |  | (170 | ) |  | (60.7 | )% |  | (433 | )
Shared services and corporate |  | (18,654 | ) |  | 15.4 | % |  | (16,158 | )
Acquisition and related integration costs |  | (4,910 | ) |  |  |  | (3,480 | )
Restructuring costs |  | — |  |  |  |  | (938 | )
Depreciation and amortization of intangible assets |  | (27,915 | ) |  |  |  |  | (17,792 | )
Gains (losses), net on disposal of property and equipment |  | (1,433 | ) |  |  |  | (173 | )
Interest expense |  | (25,798 | ) |  |  |  | (8,916 | )
Defined benefit pension plan expense |  | (1,026 | ) |  |  |  | (1,572 | )
Miscellaneous, net |  | 1,114 |  |  |  |  | (800 | )
Loss from operations before income taxes |  | $ | (11,030 | ) |  |  |  | $ | (11,148 | )

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Local Media — Our Local Media segment includes our 60 local broadcast stations and their related digital operations. It is comprised of 18 ABC affiliates, 11 NBC affiliates, nine CBS affiliates and four FOX affiliates. We also have 13 CW affiliates - five on full power stations and eight on multicast; two MyNetworkTV affiliates; two independent stations and nine additional low power stations. Our Local Media segment earns revenue primarily from the sale of advertising to local, national and political advertisers and retransmission fees received from cable operators, telecommunications companies and satellite carriers. We also receive retransmission fees from over-the-top virtual MVPDs such as Hulu, YouTubeTV and AT&T Now.
National television networks offer affiliates a variety of programs and sell the majority of advertising within those programs. In addition to network programs, we broadcast internally produced local and national programs, syndicated programs, sporting events and other programs of interest in each station's market. News is the primary focus of our locally produced programming.
The operating performance of our Local Media group is most affected by local and national economic conditions, particularly conditions within the automotive and services categories, and by the volume of advertising purchased by campaigns for elective office and political issues. The demand for political advertising is significantly higher in the third and fourth quarters of even-numbered years.
Operating results for our Local Media segment were as follows:

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | Change |  | 2019
Segment operating revenues: |  |  |  |  |  |  |
Core advertising |  | $ | 160,522 |  |  | 41.5 | % |  | $ | 113,404 |
Political |  | 18,720 |  |  |  |  |  | 880 |
Retransmission |  | 137,198 |  |  | 60.7 | % |  | 85,377 |
Other |  | 5,364 |  |  | 44.0 | % |  | 3,726 |
Total operating revenues |  | 321,804 |  |  | 58.2 | % |  | 203,387 |
Segment costs and expenses: |  |  |  |  |  |  |
Employee compensation and benefits |  | 111,596 |  |  | 49.0 | % |  | 74,911 |
Programming |  | 102,273 |  |  | 68.4 | % |  | 60,717 |
Other expenses |  | 51,958 |  |  | 54.7 | % |  | 33,586 |
Total costs and expenses |  | 265,827 |  |  | 57.1 | % |  | 169,214 |
Segment profit |  | $ | 55,977 |  |  | 63.8 | % |  | $ | 34,173 |

On September 19, 2019, we acquired eight television stations from the Nexstar-Tribune transaction, and on May 1, 2019, we acquired 15 television stations from Cordillera. These stations are referred to as the "acquired stations" in the discussion that follows. The inclusion of operating results from these stations for the periods subsequent to their acquisition impacts the comparability of our Local Media segment operating results.
Revenues
Total Local Media revenues increased $118 million or 58% in the first three months of 2020 when compared to the prior period. Excluding the acquired stations, Local Media revenues increased 11% in the quarter, driven by higher political revenues in an election year and an increase in retransmission revenue, partially offset by a 5.6% decrease in core advertising revenue. We estimate that the impact of the COVID-19 pandemic reduced our core advertising revenues by at least $8 million in the first quarter of 2020. Retransmission revenue increased during the first quarter of 2020 as we renegotiated retransmission consent contracts covering just over 20% of our subscriber households. In addition, on December 31, 2019, our agreement with Comcast reset, and for those stations we owned prior to 2019, we began to receive retransmission fees for which we had historically received little to no compensation. We expect to renegotiate retransmission consent agreements covering an additional 20% of our subscribers during the remainder of 2020.
Our Local Media revenues are being impacted due to weakened economic conditions resulting from the COVID-19 pandemic, primarily our core advertising revenues. We do not expect our retransmission revenues or political advertising revenues, which are more than 55% of Local Media revenues, to be significantly impacted. A number of factors will ultimately have an impact on our second quarter core advertising revenues, including the pace of businesses re-opening and consumer
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spending rebounding across our markets. Core advertising revenues decreased 40% in April 2020 from March 2020 as our markets felt the impact of state governments' stay-at-home and business shutdown orders. Based on our advertising pacing, we expect core advertising revenue to improve from April 2020 to May 2020 and from May 2020 to June 2020.
Costs and expenses
Employee compensation and benefits increased $36.7 million or 49% in the first three months of 2020. Excluding the acquired stations, the expense increased 4.5% due to the annual merit increase that occurred in March 2019.
Programming expense increased $41.6 million or 68% in the first three months of 2020 when compared to the prior period. Excluding the acquired stations, programming expense increased 23% in the quarter primarily due to higher network affiliation fees. Network affiliation fees have been increasing industry-wide due to higher rates on renewals, as well as contractual rate increases during the terms of the affiliation agreements, and we expect that they may continue to increase over the next several years.
Other expenses increased $18.4 million or 55% in the first three months of 2020 when compared to the prior period, mainly due to the acquired stations. Excluding the acquired stations, other expenses increased just 1.0% in the quarter.
National Media — Our National Media segment is comprised of the operations of our national media businesses, including five national broadcast networks, the Katz networks; podcast industry-leader, Stitcher, and its advertising network Midroll Media; next-generation national news network, Newsy; a global leader in digital audio technology and measurement services, Triton; and other national brands. Our National Media group earns revenue primarily through the sale of advertising. Intrasegment revenue eliminations totaled $0.4 million in the first three months of 2020 and are included in the other revenue caption.
Operating results for our National Media segment were as follows:

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | Change |  | 2019
Segment operating revenues: |  |  |  |  |  |
Katz |  | $ | 65,891 |  |  | 30.7 | % |  | $ | 50,395 |
Stitcher |  | 17,128 |  |  | 13.4 | % |  | 15,104 |
Newsy |  | 10,864 |  |  | 29.7 | % |  | 8,378 |
Triton |  | 10,347 |  |  | (1.1 | )% |  | 10,462 |
Other |  | 3,372 |  |  | 13.2 | % |  | 2,978 |
Total operating revenues |  | 107,602 |  |  | 23.2 | % |  | 87,317 |
Segment costs and expenses: |  |  |  |  |  |
Employee compensation and benefits |  | 22,820 |  |  | 11.2 | % |  | 20,525 |
Programming |  | 42,696 |  |  | 14.1 | % |  | 37,418 |
Other expenses |  | 30,301 |  |  | 24.0 | % |  | 24,433 |
Total costs and expenses |  | 95,817 |  |  | 16.3 | % |  | 82,376 |
Segment profit |  | $ | 11,785 |  |  |  |  |  | $ | 4,941 |

Revenues
National Media revenues increased $20.3 million or 23% in the first three months of 2020 when compared to the prior period. Katz's revenues increased $15.5 million or 31% as a result of growth on all of its networks, as well as the launch of the new network, Court TV, in May 2019. Newsy's revenues increased $2.5 million or 30% primarily from growth of advertising on over-the-top platforms. Stitcher and our other national brands had moderate revenue growth, while Triton's revenue remained relatively flat year-over-year. Due to weakened economic conditions as a result of the COVID-19 pandemic, we estimate that our National Media revenues were impacted by approximately $1.3 million in the first quarter of 2020 and have felt the effects of the soft advertising environment into the second quarter. National Media revenues in April 2020 were down 19% from March 2020 revenues, but we are seeing stabilization in revenues for the remainder of the second quarter.
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Costs and expenses
Employee compensation and benefits increased $2.3 million or 11% in the first three months of 2020 when compared to the prior period, mainly attributable to increased hiring at Katz and Newsy to support the growth of the brands.
Programming expense increased $5.3 million or 14% in the first three months of 2020 when compared to the prior period. Programming expense includes the amortization and distribution of programming for Katz, podcast production costs and other programming costs. The overall increase is attributable to the continual investment in Katz programming, higher affiliate fees related to the increased distribution of all of the Katz networks and the additional programming costs for our podcast business as a result of higher revenue.
Other expenses increased $5.9 million or 24% in the first three months of 2020 when compared to the prior period. Katz had higher rating expenses due to contractual increases and the addition of Court TV ratings. Additionally, advertising and promotion costs were higher due to the launch of Court TV, promotion of Bounce network's original programming and Newsy's audience extension product.
Shared services and corporate
We centrally provide certain services to our business segments. Such services include accounting, tax, cash management, procurement, human resources, employee benefits and information technology. The business segments are allocated costs for such services at amounts agreed upon by management. Such allocated costs may differ from amounts that might be negotiated at arms-length. Costs for such services that are not allocated to the business segments are included in shared services and corporate costs. Shared services and corporate also includes unallocated corporate costs, such as costs associated with being a public company.
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Liquidity and Capital Resources
Our primary source of liquidity is our available cash and borrowing capacity under our revolving credit facility. Our primary source of cash is generated from our ongoing operations. Cash from operations can be affected by various risks and uncertainties, including, but not limited to, the effects of the COVID-19 pandemic. At the end of March 2020, we had approximately $180 million of cash on hand and about $28 million of additional borrowing capacity under our revolving credit facility. Based on our current business plan, we believe our cash flow from operations will provide sufficient liquidity during this economic downturn to meet the Company’s operating needs for the next 12 months. In addition, the Company’s liquidity is enhanced through the federal government’s stimulus measures, including the deferral of social security taxes and pension contributions; tax relief on the use of net operating losses and interest expense limitations; and a few other provisions that either bring in cash this year or push out cash payments to 2021 and beyond. While we currently do not anticipate liquidity constraints, in the event of a prolonged period of economic weakness there are additional measures we could take to further control cost, slow our working capital needs and generate cash.
Debt Covenants
Our term loans and our unsecured notes do not have maintenance covenants. The earliest maturity of our term loans and unsecured notes is the fourth quarter of 2024. Our revolving credit facility permits maximum leverage of 4.5 times the two-year average earnings before interest, taxes, depreciation and amortization (EBITDA) as defined by our credit agreement, through second quarter of 2021, at which point it steps down to 4.25 times. Based upon our current outlook, we expect to be in compliance with that covenant.
Cash Flows - Operating Activities
Cash flows from operating activities for the three months ended March 31 are as follows:

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | 2019
Cash Flows from Operating Activities: |  |  |  |
Net loss |  | $ | (11,809 | ) |  | $ | (6,814 | )
Adjustments to reconcile net loss to net cash flows from operating activities: |  |  |  |
Depreciation and amortization |  | 27,915 |  |  | 17,792 |
(Gain)/loss on sale of property and equipment |  | 1,433 |  |  | 173 |
Programming assets and liabilities |  | (28,834 | ) |  | (1,133 | )
Deferred income taxes |  | 14,672 |  |  | (4,341 | )
Stock and deferred compensation plans |  | 2,208 |  |  | 7,352 |
Pension expense, net of contributions |  | (4,034 | ) |  | (408 | )
Other changes in certain working capital accounts, net |  | 10,996 |  |  | (25,776 | )
Miscellaneous, net |  | 1,154 |  |  | (37 | )
Net cash provided by (used in) operating activities |  | $ | 13,701 |  |  | $ | (13,192 | )

In 2020, cash provided by operating activities was $13.7 million compared to $13.2 million of cash used in operating activities in 2019. The $27 million increase in cash provided by operating activities was attributable to a $26 million year-over-year increase in segment profit combined with a $37 million year-over-year increase in cash provided from changes in certain working capital accounts. These increases in cash flow were partially offset by a $21 million increase in interest paid and year-over-year cash outlay increase of $28 million for programming investments in excess of programming amortization. Interest payments increased due to the issuance of a $765 million term loan B in May 2019 and issuance of $500 million of senior unsecured notes in July 2019 in order to fund the Cordillera and Nexstar-Tribune acquisitions.
The primary factors affecting changes in certain working capital accounts are described below:

• | Year-over-year cash provided from changes in accounts receivable increased $8 million in 2020 compared to 2019 due to political advertising revenue recognized during an election year, which is paid in advance and displaces traditional local and national advertising.

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• | Timing of payments made on accrued liabilities increased the year-over year cash provided from working capital by $19 million. Timing of Katz carriage fee payments accounted for nearly $18 million of this increase.

• | The accrual of payroll and lower year-over-year annual incentive payments increased cash provided from working capital by $8 million.

Cash Flows - Investing Activities
Cash flows from investing activities for the three months ended March 31 are as follows:

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | 2019
Cash Flows from Investing Activities: |  |  |  |
Acquisitions, net of cash acquired |  | $ | — |  |  | $ | (55,199 | )
Acquisition of intangible assets |  | (525 | ) |  | (404 | )
Additions to property and equipment |  | (16,210 | ) |  | (13,440 | )
Purchase of investments |  | (3,087 | ) |  | (115 | )
Proceeds from FCC repack |  | 2,719 |  |  | 1,520 |
Miscellaneous, net |  | 773 |  |  | 1 |
Net cash used in investing activities |  | $ | (16,330 | ) |  | $ | (67,637 | )

In 2020 and 2019, we used $16.3 million and $67.6 million, respectively, in cash for investing activities. The primary factors affecting our cash flows from investing activities for the periods presented are described below.

• | Capital expenditures increased $2.8 million year-over-year due to an increase in spending at Local Media, partially offset by a decrease in year-over-year FCC repack expenditures.

• | In 2020, we contributed just over $3 million in cash to our investments.

• | In 2020 and 2019, we received $2.7 million and $1.5 million, respectively, in reimbursement proceeds from the FCC.

• | During 2019, we acquired three television stations owned by Raycom Media for $55 million in cash.

In the repacking process associated with the incentive spectrum auction conducted by the FCC in 2017, the FCC has reassigned some stations to new post-auction channels. We do not expect reassignment to new channels to have a material impact on our stations' broadcast signals as viewed in their markets. Twenty-seven of our current full power stations (including nine from recent acquisitions) have been assigned to new channels. The legislation authorizing the incentive auction and repack provides the FCC with up to a $2.75 billion fund to reimburse reasonable costs incurred by stations that are reassigned to new channels in the repack. We expect the FCC fund will be sufficient to cover the costs we would expect to incur for the repack and that our only potential funding risks would be limited to any disagreements with the FCC over reimbursement of expenditures incurred. Reimbursements provided by the FCC are recognized as the cash is received.
We have spent $39.8 million to date on FCC repack and expect to incur approximately $18 million of additional expenditures through the end of 2020. We have received total reimbursement proceeds from the FCC of $11.2 million, of which, $2.7 million was received during the three months ended March 31, 2020.
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Cash Flows - Financing Activities
Cash flows from financing activities for the three months ended March 31 are as follows:

|  | Three Months Ended March 31,
(in thousands) |  | 2020 |  | 2019
Cash Flows from Financing Activities: |  |  |  |
Net borrowings under revolving credit facility |  | $ | 175,000 |  |  | $ | — |
Payments on long-term debt |  | (2,653 | ) |  | (750 | )
Dividends paid |  | (4,108 | ) |  | (4,040 | )
Repurchase of Class A Common shares |  | — |  |  | (584 | )
Tax payments related to shares withheld for vested stock and RSUs |  | (2,266 | ) |  | (3,649 | )
Miscellaneous, net |  | (16,574 | ) |  | (2,862 | )
Net cash provided by (used in) financing activities |  | $ | 149,399 |  |  | $ | (11,885 | )

In 2020, cash provided by financing activities was $149 million and in 2019, we used $11.9 million in cash for financing activities. Due to current uncertainty in the global economy resulting from the COVID-19 pandemic, in order to preserve the Company's financial flexibility, we drew $175 million under our revolving credit facility in March 2020. Other factors impacting our cash flows from financing activities are described below.
We have $900 million of unsecured senior notes and $1.0 billion outstanding balance on our term loans. Our debt had required principal payments of nearly $2.7 million in the first quarter of 2020 and will have required payments of $8.0 million for the remainder of 2020.
We paid quarterly dividends of 5 cents per share, totaling $4.1 million and $4.0 million in 2020 and 2019, respectively.
In November 2016, our Board of Directors authorized a share repurchase program of up to $100 million of our Class A Common shares, which expired on March 1, 2020. In February 2020, our Board of Directors authorized a new share repurchase program of up to$100 million of our Class A Common shares through March 1, 2022. Shares can be repurchased under the authorization via open market purchases or privately negotiated transactions, including accelerated stock repurchase transactions, block trades, or pursuant to trades intended to comply with Rule 10b5-1 of the Securities Exchange Act of 1934. No shares were repurchased under either authorization during the first quarter of 2020 as the Company has temporarily suspended share buybacks. During the first three months of 2019, we repurchased $0.6 million of shares.
Other
We are required to contribute an additional $27 million to fund our qualified defined benefit pension plan in order to meet our 2020 funding requirements under the provisions of the Pension Funding Equity Act of 2004 and the Pension Protection Act of 2006. In response to COVID-19, President Donald Trump signed into law the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”). The CARES Act provides a provision to defer 2020 pension contributions until January 1, 2021. We anticipate delaying the payment of 2020 pension contributions in accordance with the CARES Act provision.
Off-Balance Sheet Arrangements and Contractual Obligations
Off-Balance Sheet Arrangements
There have been no material changes to the off-balance sheet arrangements disclosed in our 2019 Annual Report on Form 10-K.
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Critical Accounting Policies and Estimates
The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) requires us to make a variety of decisions that affect reported amounts and related disclosures, including the selection of appropriate accounting principles and the assumptions on which to base accounting estimates. In reaching such decisions, we apply judgment based on our understanding and analysis of the relevant circumstances, including our historical experience, actuarial studies and other assumptions. We are committed to incorporating accounting principles, assumptions and estimates that promote the representational faithfulness, verifiability, neutrality and transparency of the accounting information included in the financial statements.
Note 1 to the Consolidated Financial Statements included in our 2019 Annual Report on Form 10-K describes the significant accounting policies we have selected for use in the preparation of our financial statements and related disclosures. An accounting policy is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made and if different estimates that reasonably could have been used or changes in estimates that are likely to occur could materially change the financial statements. We believe the accounting for acquisitions, goodwill and indefinite-lived intangible assets and pension plans to be our most critical accounting policies and estimates. A detailed description of these accounting policies is included in the Critical Accounting Policies section of Management's Discussion and Analysis of Financial Condition and Results of Operations included in our 2019 Annual Report on Form 10-K.
Recent Accounting Guidance
Refer to Note 2 – Recently Adopted and Issued Accounting Standards of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) for further discussion.
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Quantitative and Qualitative Disclosures About Market Risk
Earnings and cash flow can be affected by, among other things, economic conditions and interest rate changes. We are also exposed to changes in the market value of our investments.
Our objectives in managing interest rate risk are to limit the impact of interest rate changes on our earnings and cash flows and to reduce overall borrowing costs.
The following table presents additional information about market-risk-sensitive financial instruments:

|  | As of March 31, 2020 |  | As of December 31, 2019
(in thousands) |  | Cost Basis |  | Fair Value |  | Cost Basis |  | Fair Value
Financial instruments subject to interest rate risk: |  |  |  |  |  |  |  |
Revolving credit facility |  | $ | 175,000 |  |  | $ | 175,000 |  |  | $ | — |  |  | $ | — |
Senior unsecured notes, due in 2025 |  | 400,000 |  |  | 358,000 |  |  | 400,000 |  |  | 409,000 |
Senior unsecured notes, due in 2027 |  | 500,000 |  |  | 440,000 |  |  | 500,000 |  |  | 525,000 |
Term loan, due in 2024 |  | 292,500 |  |  | 279,338 |  |  | 293,250 |  |  | 293,617 |
Term loan, due in 2026 |  | 757,369 |  |  | 727,074 |  |  | 759,272 |  |  | 763,547 |
Long-term debt, including current portion |  | $ | 2,124,869 |  |  | $ | 1,979,412 |  |  | $ | 1,952,522 |  |  | $ | 1,991,164 |
Financial instruments subject to market value risk: |  |  |  |  |  |  |  |
Investments held at cost |  | $ | 4,493 |  |  | (a) |  |  | $ | 4,405 |  |  | (a) |
(a) Includes securities that do not trade in public markets, thus the securities do not have readily determinable fair values. We estimate the fair value of these securities approximates their carrying value.

F-30

Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Scripps management is responsible for establishing and maintaining adequate internal controls designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The Company’s internal control over financial reporting includes those policies and procedures that:

1. | pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company;

2. | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and the directors of the Company; and

3. | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

All internal control systems, no matter how well designed, have inherent limitations, including the possibility of human error, collusion and the improper overriding of controls by management. Accordingly, even effective internal control can only provide reasonable but not absolute assurance with respect to financial statement preparation. Further, because of changes in conditions, the effectiveness of internal control may vary over time.
The effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) was evaluated as of the date of the financial statements. This evaluation was carried out under the supervision of and with the participation of management, including the Chief Executive Officer and the Chief Financial Officer. Based upon that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that the design and operation of these disclosure controls and procedures are effective.
There were no changes to the Company's internal controls over financial reporting (as defined in Exchange Act Rule 13a-15(f)) during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting. We acquired 15 television stations from Cordillera Communications, LLC on May 1, 2019 and eight television stations from the Nexstar Media Group, Inc. transaction with Tribune Media Company on September 19, 2019, and have excluded these businesses from management's reporting on internal control over financial reporting, as permitted by SEC guidance, for the quarter ended March 31, 2020. The acquired operations have total assets of approximately $1.3 billion, or 35% of our total assets as of March 31, 2020, and revenues of $95.8 million, or 22% of our total revenues for the three months ended March 31, 2020.
F-31