Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For The Fiscal Year Ended September 27, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 1-6227 LEE ENTERPRISES, INCORPORATED (Exact name of Registrant as specified in its Charter) Delaware 42-0823980 (State of incorporation) (I.R.S. Employer Identification No.) 4600 E 53rd Street, Davenport, Iowa 52807 (Address of principal executive offices) (563) 383-2100 Registrant's telephone number, including area code Securities registered pursuant to Section 12(b) of the Act: Title of Each Class Trading Symbol(s) Name of Each Exchange On Which Registered Common Stock - $0.01 par value LEE New York Stock Exchange Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒ Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒ 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 such shorter period that the Registrant was required to submit). 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 the definitions 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 ☐ Non-accelerated filer ☒ Smaller Reporting Company ☒ Emerging growth 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 ☒ As of March 31, 2020, the aggregate market value of the Registrant's common stock held by non-affiliates of the registrant was $52,359,374 based on the closing sale price as reported on the New York Stock Exchange. As of November 30, 2020, 58,353,084 shares of Common Stock $0.01 par value were outstanding. DOCUMENTS INCORPORATED BY REFERENCE Portions of the Lee Enterprises, Incorporated Definitive Proxy Statement to be filed in January 2021 are incorporated by reference in Part III of this Form 10-K. Except as expressly incorporated by reference, the Registrant's Definitive Proxy Statement shall not be deemed to be a part of this report. TABLE OF CONTENTS PAGE Part I Item 1 Business 1 Item 1A Risk Factors 9 Item 1B Unresolved Staff Comments 14 Item 2 Properties 14 Item 3 Legal Proceedings 14 Item 4 Mine Safety Disclosures 14 Part II Item 5 Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases 14 of Equity Securities Item 6 Selected Financial Data 16 Item 7 Management's Discussion and Analysis of Financial Condition and Results of Operations 17 Item 7A Quantitative and Qualitative Disclosures about Market Risk 25 Item 8 Financial Statements and Supplementary Data 25 Item 9 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 25 Item 9A Controls and Procedures 26 Item 9B Other Information 28 Part III Item 10 Directors, Executive Officers and Corporate Governance 28 Item 11 Executive Compensation 28 Item 12 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder 28 Matters Item 13 Certain Relationships and Related Transactions, and Director Independence 28 Item 14 Principal Accounting Fees and Services 28 Part IV Item 15 Exhibits and Financial Statement Schedules 29 Consolidated Financial Statements 30 Signatures 64 Exhibit Index 62 References to “we”, “our”, “us” and the like throughout this document refer to Lee Enterprises, Incorporated and subsidiaries (the "Company"). References to "2020", "2019", "2018" and the like refer to the fiscal years ended the last Sunday in September. PART I ITEM 1. BUSINESS Lee Enterprises, Incorporated ("Company", "we" or "our") is a trusted local news provider and an innovative, digitally focused marketing solutions company operating in 77 mid-sized markets across 26 states. On March 16, 2020, we completed the acquisition of BH Media Group, Inc. (BH Media) and The Buffalo News, Inc. (Buffalo News), adding 31 local media operations and nearly doubling our audience size and total operating revenue. Our products include high quality, trusted local daily, weekly and monthly newspapers and niche publications. All of our products offer print and digital editions, and our content and advertising is available in real time through our websites and mobile apps. Our local media operations range from large daily newspapers and the associated digital products, such as the St. Louis Post-Dispatch and The Buffalo News, to non-daily newspapers with news websites and digital platforms serving smaller communities. Our services include a full service digital marketing agency in Amplified Digital Agency ("Amplified") as well as one of the largest web-hosting and content management services providers in North America through our majority-owned subsidiary, TownNews. As the leading provider of local news, information and a major source of advertising in our markets we aim to grow our business through three main categories: subscriptions to our print and digital editions, advertising and marketing services to local retail accounts, and digital services to a diverse set of customers. • We are committed to a business strategy that drives audience growth and engagement by delivering valuable, intensely local, original news and information to consumers. • Local, controllable retail accounts - those in which our local sales teams have direct contact with the advertising decision makers - are the core of our business. 47% of our advertising revenue is from local retail accounts, and trends in this category have historically been better than our total advertising trends. • TownNews represents a powerful opportunity for us to drive additional digital revenue by providing state-of-the-art web hosting and content management services. More than 2,000 customers rely on TownNews for their web, over-the-top display ("OTT"), mobile, video and social media products. Revenue at TownNews on a stand-alone basis grew at compound annual growth rate ("CAGR") of 10.8% over the last nine years. Our local media operations generate revenue primarily through print and digital advertising and marketing services, subscriptions to our publications and digital services, primarily through TownNews. Our operations also provide commercial printing and distribution of third party publications. Advertising and Marketing Services - In 2020, advertising and marketing services of $289.7 million comprised 47% of total operating revenue, down from 52% in the prior year. Local retail advertising is revenue earned from top local accounts and small to medium businesses (SMBs) in our markets and takes the form of display advertising in daily and non-daily publications, preprinted advertising inserted in the publication, and display advertising delivered on our owned and operated websites. Classified advertising includes major categories of employment, real estate, automotive, obituaries and legal notices. Advertising for classifieds is published in both the print and digital editions of our products and is also posted on our websites and mobile applications. National advertising is revenue earned from the sale of print or digital display advertising space, or from preprinted advertising inserted in the publication, from national accounts that do not have a local retailer representing the account in the market. Niche publications are specialty publications, such as lifestyle, business, health or home improvement publications that contain advertising. Marketing services represents a complete suite of services including web development, social media management, PPC, targeting and videos, events, contests and digital promotions offered in our local markets through Amplified. Our sales force uses a multi-platform sales approach that maximizes audience reach for our advertisers by tailoring advertising and marketing services packages based on the size and scale of the advertiser. Through Amplified we create sophisticated digital campaigns on our owned and operated sites and on third party inventory that give advertisers the ability to target their message. We partner with Google to provide key metrics and analytics to measure campaign effectiveness. Our advertising revenues are subject to seasonality due primarily to fluctuations in advertising spend. Advertising revenue is typically highest in our first quarter due to holiday and seasonal advertising and lowest in the second