Gannett Co Inc/DE – ‘10-Q’ for 3/26/00

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Quarterly Report   —   Form 10-Q
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-Q        10-Q Report                                           11     74K 
 2: EX-3.1      Amendment of Certificate of Incorporation              2±    10K 
 3: EX-11       Earnings Per Share                                     2±     6K 
 4: EX-27       Financial Data Schedule                                2      6K 
 5: EX-27       Financial Data Schedule                                2      6K 

10-Q   —   10-Q Report
Document Table of Contents

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

FORM 10-Q               

(Mark One)                                                                      

X    Quarterly report pursuant to Section 13 or 15(d) of the Securities         
Exchange Act of 1934 for the quarterly period ended               
March 26, 2000 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 1-6961                           

GANNETT CO., INC.       
(Exact name of registrant as specified in its charter)            

Delaware                                                16-0442930              
(state or other jurisdiction of                          (I.R.S. Employer       
incorporation or organization)                          Identification No.)     

1100 Wilson Boulevard, Arlington, Virginia 22234          
(Address of principal executive offices)  (Zip Code)        

(703) 284-6000          
(Registrant's telephone number, including area code)          

(Former name, former address and former fiscal year, if       
changed since last report)                                  

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  X      No __                                                               

The number of shares outstanding of the issuer's Common Stock,                  
Par Value $1.00, as of March 26, 2000 was 266,499,524.                          

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PART I.  FINANCIAL INFORMATION                                                  

MANAGEMENT'S DISCUSSION AND ANALYSIS OF                                         
OPERATIONS                                                                      

ACQUISITIONS AND DISPOSITIONS                                                   

The sale of the assets of the company's cable division for                      
$2.7 billion was completed on January 31, 2000.  Upon closing, an               
after-tax gain of approximately $745 million or $2.69 per diluted               
share was recognized which, along with the cable segment                        
operating results, are reported as discontinued operations in the               
company's financial statements.                                                 

On March 17, 2000, the company completed the acquisition of                     
WJXX-TV, the ABC affiliate in Jacksonville, Florida.  Gannett                   
continues to own and operate WLTV-TV, the NBC affiliate in                      
Jacksonville.                                                                   

EARNINGS SUMMARY                                                                

Operating income from continuing operations for the first quarter               
of 2000 rose $60.9 million or 21%.  Newspaper publishing                        
earnings were up $59.8 million or 24% for the quarter, reflecting               
continued strong classified and national advertising demand,                    
record operating results at USA TODAY, and the positive impact                  
of Newsquest plc, a U.K. based newspaper company acquired in                    
July 1999. Television earnings were up $0.4 million or 1% for the               
quarter.                                                                        

Income from continuing operations for the first quarter rose                    
$33.0 million or 19%.  Earnings per share from continuing operations            
was $0.74 (diluted), up 22%.                                                    

After-tax income from the operation of the cable division, which                
was sold on January 31, 2000, was $2.4 million, and the after-tax               
gain from the sale of the cable division was $744.7 million.  In                
total, discontinued operations contributed $2.70 per share                      
(diluted).  Net income for the quarter was $3.44 per share                      
(diluted).                                                                      

NEWSPAPERS                                                                      

The company completed the acquisition of Newsquest on July 26,                  
1999, which has a significant impact on operating results                       
comparisons in the first quarter of 2000 versus the first quarter of            
1999.                                                                           

Reported newspaper publishing revenues rose $172.9 million or                   
17% in the first quarter, reflecting strong domestic advertising                
demand and the impact of revenues at the Newsquest properties.                  
Newspaper advertising revenues increased by $153.2 million or                   
21%.                                                                            

The tables below provide, on a pro forma basis, details of                      
newspaper ad revenue, including the newly acquired Newsquest                    
properties, for the first quarter of 2000 and 1999.  Advertising                
linage and preprint distribution details are also provided below;               
however, linage and preprint distribution for Newsquest                         
publications are not included.                                                  

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Advertising revenue, in thousands of dollars (pro forma)                        

                            2000      1999      % Change

Local                            $231,924  $234,548       (1)         
National                          166,331   144,009       16          
Classified                        359,257   335,613        7          
                        --------  --------      ----
Total Run-of-Press                757,512   714,170        6          

Preprint and other advertising    116,277   107,655        8          
                        --------  --------      ----
Total ad revenue                 $873,789  $821,825        6          
                        ========  ========      ====

Advertising linage, in thousands of inches, and preprint                        
distribution, in millions (pro forma)                                           

                            2000      1999      % Change

Local                               7,909     7,992       (1)         
National                              914       783       17          
Classified                         11,372    10,409        9          
                        --------  --------      ----
Total Run-of-Press linage          20,195    19,184        5          
                        ========  ========      ====

Preprint distribution               1,790     1,699        5          
                        ========  ========      ====

Pro forma newspaper advertising revenues rose 6% for the                        
quarter.  Local ad revenues and volume declined by 1%.  National                
ad revenues rose 16% on a volume increase of 17%.  Classified ad                
revenues increased 7% on a volume increase of 9%.  Most of the                  
company's newspapers, including USA TODAY, recorded solid                       
gains in advertising revenue.  Classified gains were strongest in the           
employment and real estate categories.                                          

Reported newspaper circulation revenues increased by $13.7                      
million or 5% for the first quarter, reflecting the impact of the               
Newsquest acquisition.  Pro forma net paid daily circulation for the            
company's local newspapers declined by less than 1%.  Sunday                    
circulation was lower by 1%.  USA TODAY reported an average                     
daily paid circulation of 2,282,072  in the ABC Publisher's                     
statement for the 26 weeks ended March 26, 2000, a 1.5%                         
increase over the comparable period a year ago.                                 

Operating costs for the newspaper segment increased                             
$113.1 million or 15% for the first quarter, largely due to the added           
costs from the Newsquest properties.  In total, newsprint expense               
decreased 3%.  Newsprint consumption rose 14%, while newsprint                  
prices were significantly lower than in the first quarter of 1999.              
The company expects newsprint prices to rise modestly, which will               
result in higher newsprint prices for the second half of 2000 versus            
the second half of 1999.                                                        

Newspaper operating income increased $59.8 million or 24%,                      
reflecting strong advertising gains throughout the group,                       
particularly in national and classified advertising, very strong                
operating results at USA TODAY, lower newsprint prices, and the                 
positive impact of the recently acquired Newsquest properties.                  

TELEVISION                                                                      

Reported television revenues increased $5.6 million or 3% for the               
quarter, while operating costs increased $5.2 million or 5%.  On a              
pro forma basis, television station revenues increased 2%.  Pro                 
forma local revenues decreased 3%, while national revenues                      
increased 11%.  Reported television operating income increased                  
$0.4 million or 1% for the quarter.  Television comparisons                     
continue to be impacted by the exchange of Gannett's station in                 
Austin, TX, for a station in Sacramento, CA, plus other                         
consideration, which occurred in June 1999.                                     

On March 17, 2000, the company completed the acquisition of                     
WJXX-TV, the ABC affiliate in Jacksonville, Florida.  Gannett                   
continues to own and operate WTLV-TV, the NBC affiliate in                      
Jacksonville.  This transaction is not expected to materially affect            
the operating results of the company.  Gannett Television now                   
consists of 22 television stations reaching 17.4 percent of the U.S.            
television market.                                                              

NON-OPERATING INCOME AND EXPENSE/PROVISION                                      
FOR INCOME TAXES                                                                

Interest expense increased $3.6 million or 22% for the quarter,                 
reflecting increased commercial paper borrowings due to the 1999                
Newsquest acquisition and 1999 and 2000 share repurchases.  This                
increase, however, was tempered by the pay-down of commercial                   
paper borrowings during the first quarter from proceeds of the sale             
of the cable division and from operating cash flows.  Non-                      
operating expense for the first quarter reflected costs associated              
with minority investments in internet businesses, net of interest               
earned from cable sale proceeds invested in marketable securities.              

The company's effective income tax rate was 39.6% for the                       
quarter versus 39.8% for the same period last year, reflecting                  
lower state taxes and the diminished impact of the amortization of              
non-deductible intangible assets.                                               

NET INCOME                                                                      

Income from continuing operations rose $33.0 million or 19% for                 
the quarter.  Diluted earnings per share from continuing operations             
rose to $0.74 from $0.61 per share, a 22% increase.                             

Net income including discontinued operations totaled $950.2                     
million for the first quarter.  Income per share (diluted), including           
discontinued operations, was $3.44 for the quarter compared to                  
$0.64 in 1999.  Discontinued operations, including the after-tax                
gain on the sale of the cable division and the after-tax earnings of            
cable for the weeks leading up to the sale, totaled $747.1 million              
or $2.70 per diluted share.                                                     

The weighted average number of diluted shares outstanding in the                
quarter totaled 276,207,000, compared to 281,677,000 for the                    
first quarter of 1999.  On February 1, 2000, the company                        
announced that its Board approved a new $500 million share                      
repurchase authorization.  On February 23, 2000, having used a                  
substantial portion of that authorization, the Board approved an                
additional $500 million for share repurchases.  During the first                
quarter of 2000, the company repurchased approximately 11.7                     
million shares of common stock at a cost of approximately $776.4                
million.  These stock repurchases were partially offset by shares               
issued upon the exercise of stock options and settlement of stock               
incentive rights.  Exhibit 11 of this Form 10-Q presents the                    
weighted average number of basic and diluted shares outstanding                 
and the earnings per share for each period.  Further share                      
repurchases under the Board's authorization have been completed                 
in the second quarter of 2000.                                                  

LIQUIDITY AND CAPITAL RESOURCES                                                 

The company's consolidated operating cash flow (defined as                      
operating income plus depreciation and amortization of intangible               
assets) as reported in the accompanying Business Segment                        
Information totaled $437.9 million for the first three months of                
2000, compared with $362.2 million for the same period of 1999,                 
a 21% increase, reflecting strong overall operating results and the             
acquisition of Newsquest.                                                       

Capital expenditures for the quarter totaled $44.2 million,                     
compared to $40.9 million in 1999.  The company's debt was                      
reduced by $1.8 billion during the quarter and cash and marketable              
securities increased by $347.2 million, reflecting the use of                   
proceeds from the sale of the cable division.  The sale also resulted           
in significant decreases in the company's excess of acquisition cost            
over the value of assets acquired and its property, plant and                   
equipment.  Current liabilities exceed current assets at the end of             
the first quarter primarily as a result of income taxes due on the              
gain from the sale of the cable division that will be paid in the               
second quarter.  This income tax payment is expected to be funded               
principally from the liquidation of marketable securities and from              
commercial paper borrowings.                                                    

The company's foreign currency translation adjustment, included                 
in accumulated other comprehensive income and reported as part                  
of shareholders' equity, totaled $1.5 million at the end of the first           
quarter versus $14.3 million at the end of 1999, reflecting a                   
weakening of the British pound against the U.S. dollar since the                
end of the year.  Newsquest's assets and liabilities at March 26,               
2000, were translated from British pounds to U.S. dollars at an                 
exchange rate of $1.59.  Newsquest's operating results during the               
first quarter were translated at the average rate of $1.60.                     

The company's regular quarterly dividend of $0.21 per share was                 
declared in the first quarter of 2000.  Dividends declared totaled              
$56.8 million.  In May 2000, the company also declared a                        
quarterly dividend of $0.21 per share payable on July 3, 2000.                  

In May 2000, the company's shareholders approved an amendment                   
to the company's certificate of incorporation to increase the                   
authorized number of shares to 802,000,000 of which 800,000,000                 
shares shall be common stock and 2,000,000 shares shall be                      
preferred stock, both with a $1 par value.  Refer to Exhibit 3.1 for            
additional information.                                                         

Also in May 2000, the company announced that its board of                       
directors approved an amendment to its Shareholder Rights Plan                  
to extend the expiration date of the Rights to May 31, 2010 and                 
increase the initial exercise price of each Preferred Stock Purchase            
Right to $280.  Refer to the 8-K filed by the company on May 2, 2000            
for additional information.                                                     

OTHER MATTERS                                                                   

In May 2000, the company announced that Douglas H.                              
McCorkindale would succeed John J. Curley as chief executive                    
officer on June 1.  Curley will continue as chairman until he retires           
early next year when he is 62.  McCorkindale, who is 60, is                     
president and vice chairman.  He will continue to hold those titles             
until Curley retires when McCorkindale becomes chairman,                        
president and CEO.                                                              

CERTAIN FACTORS AFFECTING FORWARD-LOOKING                                       
STATEMENTS                                                                      

Certain statements in the company's 1999 Annual Report to                       
Shareholders, its Annual Report on Form 10-K, and in this                       
Quarterly Report contain forward-looking information.  The words                
"expect," "intend," "believe," "anticipate," likely," "will" and                
similar expressions generally identify forward-looking statements.              
These forward-looking statements are subject to certain risks and               
uncertainties which could cause actual results and events to differ             
materially from those anticipated in the forward-looking                        
statements.                                                                     

Potential risks and uncertainties which could adversely affect the              
company's ability to obtain these results include, without                      
limitation, the following factors: (a) increased consolidation among            
major retailers or other events which may adversely affect business             
operations of major customers and depress the level of local and                
national advertising; (b) an economic downturn in some or all of                
the company's principal newspaper or television markets leading                 
to decreased circulation or local, national or classified advertising;          
(c) a decline in general newspaper readership patterns as a result of           
competitive alternative media or other factors; (d) an increase in              
newsprint or syndication programming costs over the levels                      
anticipated; (e) labor disputes which may cause revenue declines                
or increased labor costs; (f) acquisitions of new businesses or                 
dispositions of existing businesses; (g) a decline in viewership of             
major networks and local news programming; (h) rapid                            
technological changes and frequent new product introductions                    
prevalent in electronic publishing; and (i) a weakening in the                  
British pound to U.S. dollar exchange rate.                                     

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CONSOLIDATED BALANCE SHEETS                                                              
Gannett Co., Inc. and Subsidiaries                                                       
Unaudited, in thousands of dollars                                                       


                                                         March 26, 2000    Dec. 26, 1999 
                                                        ----------------  ---------------
                                                                                         
ASSETS                                                                                   
Cash                                                    $        59,571   $       46,148 
Marketable securities                                           333,757               12 
Trade receivables, less allowance                                                        
     (2000 - $29,288; 1999 - $30,694)                           695,996          800,682 
Inventories                                                      99,272           95,014 
Prepaid expenses and other receivables                           93,727          133,366 
                                                        ----------------  ---------------
Total current assets                                          1,282,323        1,075,222 
                                                        ----------------  ---------------
Property, plant and equipment                                                            
Cost                                                          3,475,861        3,883,912 
Less accumulated depreciation                                (1,591,080)      (1,660,060)
                                                        ----------------  ---------------
Net property, plant and equipment                             1,884,781        2,223,852 
                                                        ----------------  ---------------
Intangible and other assets                                                              
Excess of acquisition cost over the value of                                             
     assets acquired, less amortization                       4,715,355        5,398,227 
Investments and other assets                                    323,702          309,145 
                                                        ----------------  ---------------
Total intangible and other assets                             5,039,057        5,707,372 
                                                        ----------------  ---------------
Total assets                                            $     8,206,161   $    9,006,446 
                                                        ================  ===============

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LIABILITIES & SHAREHOLDERS' EQUITY                                                       
Accounts payable and current portion of film                                             
     contracts payable                                  $       305,756   $      348,589 
Compensation, interest and other accruals                       233,498          271,495 
Dividend payable                                                 56,755           58,297 
Income taxes                                                  1,180,093           77,553 
Deferred income                                                 117,277          127,844 
                                                        ----------------  ---------------
Total current liabilities                                     1,893,379          883,778 
                                                        ----------------  ---------------
Deferred income taxes                                           363,137          479,547 
Long-term debt, less current portion                            650,492        2,463,250 
Postretirement medical and life insurance liabilities           304,061          304,400 
Other long-term liabilities                                     255,688          245,825 
                                                        ----------------  ---------------
Total liabilities                                             3,466,757        4,376,800 
                                                        ----------------  ---------------
Shareholders' Equity                                                                     
Preferred stock of $1 par value per share.  Authorized                                   
     2,000,000 shares; issued - none.                                                    
Common stock of $1 par value per share.  Authorized                                      
     400,000,000; issued, 324,420,732 shares.                   324,421          324,421 
Additional paid-in capital                                      154,413          153,267 
Retained earnings                                             6,398,147        5,504,810 
Accumulated other comprehensive income                            9,895           25,377 
                                                        ----------------  ---------------
Total                                                         6,886,876        6,007,875 
                                                        ----------------  ---------------
Less treasury stock - 57,921,208 shares and                                              
     46,494,301 shares respectively, at cost                 (2,129,867)      (1,359,263)
Deferred compensation related to ESOP                           (17,605)         (18,966)
                                                        ----------------  ---------------
Total shareholders' equity                                    4,739,404        4,629,646 
                                                        ----------------  ---------------
Total liabilities and shareholders' equity              $     8,206,161   $    9,006,446 
                                                        ================  ===============


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CONSOLIDATED STATEMENTS OF INCOME                                              
Gannett Co., Inc. and Subsidiaries                                             
Unaudited, in thousands of dollars (except per share amounts)                  


                                            Thirteen weeks ended         % Inc 
                                       March 26, 2000  March 28, 1999    (Dec) 
                                        -------------   -------------    ----- 
                                                                               
Net Operating Revenues:                                                        
Newspaper advertising                   $    873,789    $   720,551       21.3 
Newspaper circulation                        267,062        253,357        5.4 
Television                                   166,789        161,194        3.5 
Other                                         56,803         50,837       11.7 
                                        -------------   ------------     ----- 
Total                                      1,364,443      1,185,939       15.1 

Operating Expenses:                                                            
Cost of sales and operating expenses,                                          
  exclusive of depreciation (1)              700,696        629,881       11.2 
Selling, general and administrative                                            
  expenses, exclusive of                                                       
  depreciation (1)                           225,855        193,837       16.5 
Depreciation                                  46,608         42,715        9.1 
Amortization of intangible assets             33,766         22,914       47.4 
                                        -------------   ------------     ----- 
Total                                      1,006,925        889,347       13.2 
                                        -------------   ------------     ----- 
Operating income                             357,518        296,592       20.5 

Non-operating income (expense):                                                
Interest expense                             (20,175)       (16,592)      21.6 
Other                                         (1,326)         2,368        --  
                                        -------------   ------------     ----- 
Total                                        (21,501)       (14,224)      51.2 

Income before income taxes                   336,017        282,368       19.0 
Provision for income taxes                   133,000        112,400       18.3 
                                        -------------   ------------     ----- 
Income from continuing operations            203,017        169,968       19.4 
Discontinued operations:                                                       
  Income from the operation of                                                 
    discontinued operations, net of tax        2,437          8,925      (72.7)
  Gain on sale of cable business,                                              
    net of tax                               744,700                       --  
                                        -------------   ------------     ----- 
Net income                              $    950,154    $   178,893        --  
                                        =============   ============     ===== 

Earnings from continuing                                                       
operations per share-basic                     $0.74          $0.61       21.8 

Earnings from discontinued operations:                                         
  Earnings from the operation of                                               
  discontinued operations per                                                  
  share-basic                                  $0.01          $0.03      (72.2)

  Gains on sale of cable business                                              
  per share-basic                              $2.72                       --  
                                               -----          -----      ----- 

Net income per share-basic                     $3.47          $0.64        --  
                                               =====          =====      ===== 

Earnings from continuing                                                       
operations per share-diluted                   $0.74          $0.61       21.8 

Earnings from discounted operations:                                           
  Earnings from the operation of                                               
  discountinued operations per                                                 
  share-diluted                                $0.01          $0.03      (72.2)

  Gain on sale of cable business                                               
  per share-diluted                            $2.69                       --  
                                               -----          -----      ----- 

Net income per share-diluted                   $3.44          $0.64        --  
                                               =====          =====      ===== 

Dividends per share                            $0.21          $0.20        5.0 
                                               =====          =====      ===== 

(1) Certain 1999 amounts have been reclassified to conform with the current    
year presentation.                                                             


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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS                                       
Gannett Co., Inc. and Subsidiaries                                                    
Unaudited, in thousands of dollars                                                    

                                                             Thirteen weeks ended     
                                                       March 26, 2000   March 28, 1999
                                                       --------------   --------------
                                                                                      
Cash flows from operating activities                                                  
  Net income                                           $    950,154     $     178,893 
  Adjustments to reconcile net income to                                              
  operating cash flows:                                                               
    Discontinued operations                                  (2,437)           (8,925)
    Depreciation                                             46,608            43,435 
    Amortization of intangibles                              33,766            23,262 
    Deferred income taxes                                  (116,410)            3,498 
    Other, net                                             (491,929)          141,099 
                                                           ---------         ---------
  Net cash flow from operating activities                   419,752           381,262 
                                                           ---------         ---------

Cash flows from investing activities                                                  
  Purchase of property, plant and equipment                 (44,224)          (40,918)
  Payments for acquisitions, net of cash acquired           (89,384)             (500)
  Change in other investments                               (12,899)           (5,666)
  Proceeds from sale of certain assets                    2,714,362             2,500 
  Collection of long-term receivables                         1,900                 0 
                                                           ---------         ---------
  Net cash provided by (used for) investing activities    2,569,755           (44,584)
                                                           ---------         ---------

Cash flows from financing activities                                                  
  Payment of long-term debt                              (1,812,758)         (315,717)
  Dividends paid                                            (58,358)          (55,694)
  Cost of common shares repurchased                        (776,410)                0 
  Proceeds from issuance of common stock                      5,378             5,782 
                                                           ---------         ---------
  Net cash used for financing activities                 (2,642,148)         (365,629)
                                                           ---------         ---------
Effect of currency exchange rate change                        (191)                  
                                                           ---------         ---------
Net increase (decrease) in cash and cash equivalents        347,168           (28,951)
Balance of cash and cash equivalents at                                               
  beginning of year                                          46,160            66,187 
                                                           ---------         ---------
Balance of cash and cash equivalents at                                               
  end of first quarter                                 $    393,328     $      37,236 
                                                           =========         =========


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BUSINESS SEGMENT INFORMATION                                                  
Gannett Co., Inc. and Subsidiaries                                            
Unaudited, in thousands of dollars                                            


                                            Thirteen weeks ended       % Inc  
                                      March 26, 2000   March 28, 1999  (Dec)  
                                      --------------   --------------   ----- 
                                                                              
Operating Revenues:                                                           
Newspaper publishing                     $1,197,654      $1,024,745      16.9 
Television                                  166,789         161,194       3.5 
                                      -------------    ------------     ----- 
Total                                    $1,364,443      $1,185,939      15.1 
                                      =============    ============     ===== 

Operating Income (net of                                                      
   depreciation and amortization):                                            
Newspaper publishing                       $307,435        $247,675      24.1 
Television                                   66,127          65,717       0.6 
Corporate                                   (16,044)        (16,800)      4.5 
                                      -------------    ------------     ----- 
Total                                      $357,518        $296,592      20.5 
                                      =============    ============     ===== 

Depreciation and Amortization:                                                
Newspaper publishing                        $62,289         $47,697      30.6 
Television                                   16,126          15,708       2.7 
Corporate                                     1,959           2,224     (11.9)
                                      -------------    ------------     ----- 
Total                                       $80,374         $65,629      22.5 
                                      =============    ============     ===== 

Operating Cash Flow:                                                          
Newspaper publishing                       $369,724        $295,372      25.2 
Television                                   82,253          81,425       1.0 
Corporate                                   (14,085)        (14,576)      3.4 
                                      -------------    ------------     ----- 
Total                                      $437,892        $362,221      20.9 
                                      =============    ============     ===== 

NOTE:                                                                         
Operating Cash Flow represents operating income for each of the company's     
business segments plus related depreciation and amortization expense.         


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NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS                            

March 26, 2000                                                                  

1.  Basis of Presentation                                                       

The accompanying unaudited consolidated condensed financial                     
statements have been prepared in accordance with the instructions               
for Form 10-Q and, therefore, do not include all information and                
footnotes which are normally included in the Form 10-K and annual               
report to shareholders.  The financial statements covering the 13-week          
period ended March 26, 2000, and the comparative period of                      
1999, reflect all adjustments which, in the opinion of the company,             
are necessary for a fair statement of results for the interim periods.          

2.  Accounting Standards                                                        

In June 1998, SFAS No. 133, "Accounting for Derivative Instruments              
and Hedging Activities" was issued.  This standard is effective                 
for fiscal periods beginning after June 15, 2000.  The adoption                 
of this standard is not expected to have a material effect on the               
company's results of operations or financial position.                          

3.  Comprehensive Income                                                        

SFAS No. 130, "Reporting Comprehensive Income" established standards for        
reporting comprehensive income.  Comprehensive income for the company includes  
net income, foreign currency translation adjustments and unrealized gains on    
available-for-sale securities, as defined under SFAS No. 115, "Accounting for   
Certain Investments in Debt and Equity Securities".  Comprehensive income       
totaled $934.7 million for the first quarter.  Other comprehensive income       
relates to foreign currency translation adjustments and unrealized gains on     
available-for-sale securities, net of tax.  The accumulated other comprehensive 
income was net of a deferred income tax liability of $6.3 million at March 26,  
2000.                                                                           

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                      

The company is not subject to market risk associated with derivative financial  
instruments or derivative commodity instruments, as the company is not a party  
to any such instruments.  The company believes that its market risk from other  
financial instruments, such as accounts receivable, accounts payable and debt,  
is not material. The company is exposed to foreign exchange rate risk primarily 
due to its acquisition of Newsquest, which uses British pounds as its           
functional currency which is then translated into U.S. dollars.                 

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PART II.   OTHER INFORMATION                                                    

Item 6.  Exhibits and Reports on Form 8-K                                 

(a)  Exhibits.                                          
        See Exhibit Index for list of exhibits filed with this
report.                                       

        (b)  (i)  Current Report on Form 8-K dated February 15, 2000, in
                     connection with the company's sale of its cable business.

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.                                      

           GANNETT CO., INC.

Dated: May 4, 2000                   By: /s/George R. Gavagan                   
                                    ------------------------------------
                 George R. Gavagan
                             Vice President and Controller

Dated: May 4, 2000                   By: /s/Thomas L. Chapple                   
                                    ------------------------------------
                 Thomas L. Chapple
                              Senior Vice President, General
                     Counsel and Secretary

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EXHIBIT INDEX                                     

Exhibit                                                                         
Number  Exhibit                          Location                               

3-1     Second Restated Certificate      Incorporated by reference to Exhibit   
     of Incorporation of Gannett Co., 3-1 to Gannett Co., Inc.'s Form 10-K
       Inc.                             for the fiscal year ended December 26,
                                     1993 ("1993 Form 10-K").  Amendment
                                      incorporated by reference to Exhibit
                                       3-1 to the 1993 Form 10-K.  Amendment
                              dated May 2, 2000, attached.

3-2     By-laws of Gannett Co., Inc.     Incorporated by reference to Exhibit   
     (reflects all amendments         3-1 to Gannett Co., Inc.'s Form 10-Q
through September 24, 1997)      for the fiscal quarter ended   
                     September 28, 1997.

4-1     $1,000,000,000 Revolving         Incorporated by reference to Exhibit   
Credit Agreement among           4-1 to the 1993 Form 10-K.     
Gannett Co., Inc. and the                                       
Banks named therein.                                            

4-2     Amendment Number One             Incorporated by reference to Exhibit   
     to $1,000,000,000 Revolving      4-2 to Gannett Co., Inc.'s Form 10-Q
      Credit Agreement among           for the fiscal quarter ended June 26,
Gannett Co., Inc. and the        1994.                          
Banks named therein.                                            

4-3     Amendment Number Two to          Incorporated by reference to Exhibit   
     $1,500,000,000 Revolving         4-3 to Gannett Co., Inc.'s Form 10-K
Credit Agreement among           for the fiscal year ended      
Gannett Co., Inc. and the        December 31, 1995.             
Banks named therein.                                            

4-4     Amendment Number Three to        Incorporated by reference to Exhibit   
     $3,000,000,000 Revolving         4-4 to Gannett Co., Inc.'s Form 10-Q
Credit Agreement among           for the fiscal quarter ended   
Gannett Co., Inc. and the Banks  September 29, 1996.            
named therein.                                                  

4-5     Indenture dated as of March 1,   Incorporated by reference to Exhibit   
     1983 between Gannett Co., Inc.   4-2 to Gannett Co., Inc.'s Form 10-K
and Citibank, N.A., as Trustee.  for the fiscal year ended      
                    December 29, 1985.

4-6     First Supplemental Indenture     Incorporated by reference to Exhibit   
  dated as of November 5, 1986     4 to Gannett Co., Inc.'s Form 8-K
among Gannett Co., Inc.,         filed on November 9, 1986.     
Citibank, N.A., as Trustee, and                                 
Sovran Bank, N.A., as Successor                                 
Trustee.                                                        

4-7     Second Supplemental Indenture    Incorporated by reference to           
 dated as of June 1, 1995,        Exhibit 4 to Gannett Co., Inc.'s
 among Gannett Co., Inc.,         Form 8-K filed on June 15, 1995.
NationsBank, N.A., as Trustee,                                  
and Crestar Bank, as Trustee.                                   

4-8     Rights Plan.                     Incorporated by reference to           
                                  Exhibit 1 to Gannett Co., Inc.'s
                                 Form 8-K filed on May 23, 1990.
                                     Amendment incorporated by reference
                                 to Gannett Co., Inc.'s Form 8-K
                       filed on May 2, 2000.

4-9     Amendment Number Four to         Incorporated by reference to           
   $3,000,000,000 Revolving         Exhibit 4-9 to Gannett Co., Inc.'s
    Credit Agreement among           Form 10-Q filed on August 12, 1998.
Gannett Co., Inc. and the                                       
Banks named therein.                                            

10-1    Employment Agreement dated       Incorporated by reference to Gannett   
     December 7, 1992 between         Co., Inc.'s Form 10-K for the fiscal
    Gannett Co., Inc. and John J.    year ended December 27, 1992 ("1992
Curley.*                         Form 10-K").                   

10-2    Employment Agreement dated       Incorporated by reference to the 1992  
December 7, 1992 between         Form 10-K.                     
Gannett Co., Inc. and Douglas H.                                
McCorkindale.*                                                  

10-3    Gannett Co., Inc. 1978           Incorporated by reference to Exhibit   
      Executive Long-Term Incentive    10-3 to Gannett Co., Inc.'s Form 10-K
Plan*                            for the fiscal year ended      
                                     December 28, 1980.  Amendment No. 1
                              incorporated by reference to
                                     Exhibit 20-1 to Gannett Co., Inc.'s
                                     Form 10-K for the fiscal year ended
                                      December 27, 1981.   Amendment No. 2
                              incorporated by reference to
                                     Exhibit 10-2 to Gannett Co., Inc.'s
                                     Form 10-K for the fiscal year ended
                                       December 25, 1983.  Amendments Nos. 3
                                    and 4 incorporated by reference to
                                    Exhibit 4-6 to Gannett Co., Inc.'s
                                 Form S-8 Registration Statement
                                    No. 33-28413 filed on May 1, 1989.
                                      Amendments Nos. 5 and 6 incorporated
                                 by reference to Exhibit 10-8 to
                                       Gannett Co., Inc.'s Form 10-K for the
                                      fiscal year ended December 31, 1989.
                                 Amendment No. 7 incorporated by
                                  reference to Gannett Co., Inc.'s
                                 Form S-8 Registration Statement
                                      No. 333-04459 filed on May 24, 1996.
                                 Amendment No. 8 incorporated by
                                      reference to Exhibit 10-3 to Gannett
                                       Co., Inc.'s Form 10-Q for the quarter
                                     ended September 28, 1997. Amendment
                                      dated December 9, 1997, incorporated
                                     by reference to Gannett Co., Inc.'s
                                  1997 Form 10-K.  Amendment No. 9
                                      incorporated by reference to Exhibit
                                       10-3 to Gannett Co., Inc.'s Form 10-Q
                                      for the quarter ended June 27, 1999.

10-4    Description of supplemental      Incorporated by reference to Exhibit   
insurance benefits.*             10-4 to the 1993 Form 10-K.    

10-5    Gannett Co., Inc. Supplemental   Incorporated by reference to Exhibit   
      Retirement Plan, as amended.*    10-5 to Gannett Co., Inc.'s Form 10-K
                           for the fiscal year ended
                    December 26, 1999.

10-6    Gannett Co., Inc. Retirement     Incorporated by reference to Exhibit   
   Plan for Directors.*             10-10 to the 1986 Form 10-K.  1991
                                     Amendment incorporated by reference
                                 to Exhibit 10-2 to Gannett Co.,
                                  Inc.'s Form 10-Q for the quarter
                                      ended September 29, 1991.  Amendment
                                 to Gannett Co., Inc. Retirement
                                      Plan for Directors dated October 31,
                                    1996, incorporated by reference to
                                    Exhibit 10-6 to the 1996 Form 10K.

10-7    Amended and Restated             Incorporated by reference to Exhibit   
      Gannett Co., Inc. 1987           10-1 to Gannett Co., Inc.'s Form 10-Q
Deferred Compensation Plan.*     for the fiscal quarter ended   
                                      September 29, 1996.  Amendment No. 5
                                      incorporated by reference to Exhibit
                                       10-2 to Gannett Co., Inc.'s Form 10-Q
                                     for the quarter ended September 28,
                                      1997.  Amendment No. 2 to January 1,
                                  1997 Restatement incorporated by
                              reference to Exhibit 10-7 to
                                       Gannett Co., Inc.'s Form 10-Q for the
                              quarter ended June 27, 1999.

10-8    Gannett Co., Inc. Transitional   Incorporated by reference to Exhibit   
  Compensation Plan.*              10-13 to Gannett Co., Inc.'s Form
                                10-K for the fiscal year ended
                    December 30, 1990.

11      Statement re computation of      Attached.                              
earnings per share.                                             

27      Financial Data Schedules.        Attached.                              

The company agrees to furnish to the Commission, upon request, a copy           
of each agreement with respect to long-term debt not filed herewith             
in reliance upon the exemption from filing applicable to any series             
of debt which does not exceed 10% of the total consolidated assets of           
the company.                                                                    

*  Asterisks identify management contracts and compensatory plans               
or arrangements.                                                          

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘10-Q’ Filing		Date		First		Last			Other Filings
		5/31/10		3					8-K
		7/3/00		3					8-K,  SC TO-T
		6/15/00		9
Filed on:		5/4/00		10
		5/2/00		3		11			4,  8-A12B/A,  8-K,  DEF 14A
For Period End:		3/26/00		1		9
		3/17/00		2		3			10-K,  DEF 14A,  PRE 14A
		2/23/00		3
		2/15/00		10					8-K
		2/1/00		3					5
		1/31/00		2					4,  5
		12/26/99		4		11			10-K,  5,  5/A
		7/26/99		2
		6/27/99		11					10-Q
		3/28/99		6		8			10-Q
		8/12/98		11					10-Q
		12/9/97		11					3,  5
		9/28/97		11					10-Q
		9/24/97		11
		1/1/97		11
		10/31/96		11
		9/29/96		11					10-Q
		5/24/96		11					S-8
		12/31/95		11					10-K
		6/15/95		11
		6/1/95		11					8-K
		12/26/93		11					10-K
		12/27/92		11
		12/7/92		11
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