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8-K - FORM 8-K - AUDACY, INC.d580225d8k.htm

Exhibit 99.1

 

LOGO

Entercom Communications Corp.

Reports Second Quarter Results

(Bala Cynwyd, Pa. August 5, 2013) Entercom Communications Corp. (NYSE: ETM) today reported financial results for the quarter ended June 30, 2013.

Second Quarter Highlights

 

   

Net revenues for the quarter decreased 3% to $101.2 million

 

   

Station expenses decreased 3% to $65.7 million

 

   

Station operating income decreased 4% to $35.5 million

 

   

Adjusted EBITDA decreased 4% to $30.7 million

 

   

Adjusted net income per share increased 8% to $0.26

 

   

Free cash flow decreased 2% to $18.9 million

David J. Field, President and Chief Executive Officer stated: “Strong expense management and reduced interest expense enabled Entercom to grow Adjusted Earnings per Share despite a decline in Revenues for the quarter. Notwithstanding our disappointing Revenues, we believe that we are well positioned to accelerate our performance later in the year based on our excellent ratings and our strong competitive position that has been further bolstered by a number of recent operational and strategic enhancements.”

Additional Information

The Company reduced its outstanding net senior debt and senior notes by $3.5 million during the quarter. As of June 30, 2013, the Company had $6.3 million in cash and $545.6 million of senior debt and senior notes.

During the quarter, the Company took a $0.9 million impairment related to the anticipated sale of non-core real estate in one of its markets. This land is now classified as assets held for sale on the Company’s balance sheet.

During the quarter, the Company recognized a $1.6 million gain related to the completion of its 2009 tower sale transaction.

Earnings Conference Call and Company Information

Entercom will hold a conference call regarding the quarterly earnings release on Monday, August 5, 2013 at 5:00 PM Eastern Time. Investors will have the opportunity to submit questions to the Company regarding the Second quarter earnings release by emailing their inquiries to questions@entercom.com. Questions should be sent at least 10 minutes prior to the call. The Company will only discuss inquiries made by email prior to the conference call. The public may access the conference call by dialing 888-889-0278 (passcode: Entercom). A replay of the conference call will be available and can be accessed either by dialing 800-510-0118 or by visiting the Company’s website: www.entercom.com. Additional information and reconciliation of same station results are available on the Company’s website at www.entercom.com.

 

Exhibit 99.1 - Page 1


Entercom Communications Corp. (NYSE: ETM), led by President and CEO David Field, is one of the largest radio broadcasting companies in the United States, with a nationwide portfolio of over 100 stations in 23 markets, including San Francisco, Boston, Seattle, Denver, Portland, Sacramento and Kansas City.

Known for developing unique and highly successful locally programmed stations, Entercom is home to some of radio’s most distinguished brands and compelling personalities. The company is also the radio broadcast partner of the Boston Red Sox, Boston Celtics, Buffalo Bills, Buffalo Sabres, Kansas City Royals, Memphis Grizzlies, New Orleans Saints, New Orleans Pelicans, Oakland Athletics, Oakland Raiders and San Jose Sharks.

Entercom focuses on creating effective multi-platform marketing solutions for its customers, incorporating the company’s audio, digital and experiential assets. Additionally, the company has a long-standing commitment to responsible corporate citizenship and environmental stewardship. Entercom stations play a vital, hands-on role in improving their communities, providing over $100 million in annual support for local charitable organizations.

The company’s radio stations have received numerous awards, including multiple Edward R. Murrow Awards for excellence in broadcast journalism, as well as the National Association of Broadcasters (NAB) Marconi Award for excellence in radio broadcasting. In 2012, Entercom was named by Information Week as one of the Top 500 Technology Innovators in the United States.

Certain Definitions

All references to per share data, unless stated otherwise, are presented as per diluted share. All references to shares outstanding, unless stated otherwise, are presented to exclude unvested restricted stock units. All references to net debt are outstanding debt net of cash on hand.

Station expenses consist of station operating expenses excluding non-cash compensation expense.

Corporate expenses consist of corporate general and administrative expenses excluding non-cash compensation expense.

Station operating income consists of operating income (loss) before: depreciation and amortization; time brokerage agreement fees (income); corporate general and administrative expenses; non-cash compensation expense (which is otherwise included in station operating expenses); impairment loss; merger and acquisition costs; and gain or loss on sale or disposition of assets.

 

Exhibit 99.1 - Page 2


Adjusted EBITDA consists of net income (loss), adjusted to exclude: income taxes (benefit); total other expense; depreciation and amortization; time brokerage agreement fees (income); non-cash compensation expense (which is otherwise included in station operating expenses and corporate G&A expenses); impairment loss; merger and acquisition costs; and gain or loss on sale or disposition of assets.

Free cash flow consists of operating income (loss): (i) plus depreciation and amortization, net (gain) loss on sale or disposal of assets; non-cash compensation expense (which is otherwise included in station operating expenses and corporate general and administrative expenses), impairment loss; merger and acquisition costs; and (ii) less net interest expense (excluding amortization of deferred financing costs), taxes paid and capital expenditures.

Adjusted net income consists of net income (loss) adjusted to exclude: (i) income taxes (benefit) as reported; (ii) gain/loss on sale of assets, derivative instruments and investments; (iii) non-cash compensation expense; (iv) other income; (v) impairment loss; (vi) merger and acquisition costs; and (vii) gain/loss on early extinguishment of debt. For purposes of comparability, income taxes are reflected at the expected statutory federal and state income tax rate of 42% without discrete items of tax.

Adjusted net income per share includes any dilutive equivalent shares when not anti-dilutive.

Same station is computed by comparing the performance of stations operated by the Company throughout the relevant period to the comparable performance in the prior year’s corresponding period (excluding non-cash compensation expense). Any acquisition or disposition of radio stations not deemed to be material by management are ignored for the purpose of computing this data. There were no material acquisitions during the periods presented in the above tables.

Non-GAAP Financial Measures

It is important to note that station operating income, station expense, corporate expense, same station net revenues, same station expenses, same station operating income, adjusted EBITDA, adjusted net income, adjusted net income per share and free cash flow are not measures of performance or liquidity calculated in accordance with generally accepted accounting principles (“GAAP”). Management believes that these measures are useful as a way to evaluate the Company and the means for management to evaluate our radio stations’ performance and operations. Management believes that these measures are useful to an investor in evaluating our performance because they are widely used in the broadcast industry as a measure of a radio company’s operating performance.

Certain adjusted non-GAAP financial measures are presented in this release (e.g., adjusted net income and adjusted net income per share). The adjustments exclude gain/loss on sale of assets, derivative instruments, and investments; non-cash compensation expense, other income, impairment loss and gain/loss on early extinguishment of debt. Management believes these adjusted non-GAAP measures provide useful information to Management and investors by excluding certain income, expenses and gains and losses that may not be indicative of the Company’s core operating and financial results. Similarly, Management believes these adjusted measures are a useful performance measure because certain items included in the calculation of net income (loss) may either mask or exaggerate trends in the Company’s ongoing operating performance. Further, the reconciliations corresponding to these adjusted measures, by identifying the individual adjustments, provide a useful mechanism for investors to consider these adjusted measures with some or all of the identified adjustments.

 

Exhibit 99.1 - Page 3


Management uses these non-GAAP financial measures on an ongoing basis to help track and assess the Company’s financial performance. You, however, should not consider non-GAAP measures in isolation or as substitutes for net income (loss), operating income, or any other measure for determining our operating performance that is calculated in accordance with generally accepted accounting principles. These non-GAAP measures are not necessarily comparable to similarly titled measures employed by other companies. The accompanying financial tables provide reconciliations to the nearest GAAP measure of all non-GAAP measures provided in this release.

Note Regarding Forward-Looking Statements

The information in this news release is being widely disseminated in accordance with the Securities and Exchange Commission’s Regulation FD.

This news announcement contains certain forward-looking statements that are based upon current expectations and certain unaudited pro forma information that is presented for illustrative purposes only and involves certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Additional information and key risks are described in the Company’s filings on Forms 8-K, 10-Q and 10-K with the Securities and Exchange Commission. Readers should note that these statements might be impacted by several factors including changes in the economic and regulatory climate and the business of radio broadcasting, in general. The unaudited pro forma information and same station operating data reflect adjustments and are presented for comparative purposes only and do not purport to be indicative of what has occurred or indicative of future operating results or financial position. Accordingly, the Company’s actual performance may differ materially from those stated or implied herein. The Company assumes no obligation to publicly update or revise any unaudited pro forma or forward-looking statements.

Contact:

Steve Fisher

Executive Vice President and Chief Financial Officer

610-660-5647

 

Exhibit 99.1 - Page 4


Second Quarter 2013

Earnings Release

ENTERCOM COMMUNICATIONS CORP.

FINANCIAL DATA

(amounts in thousands, except per share data)

(unaudited)

 

     Three Months Ended
June 30,
    Six Months Ended
June 30,
 
     2013     2012     2013     2012  

STATEMENTS OF OPERATIONS

      

Net Revenues

   $ 101,239      $ 104,571      $ 179,599        184,537   
  

 

 

   

 

 

   

 

 

   

 

 

 

Station Expenses

     65,741        67,570        123,601        127,137   

Station Expense - Non-Cash Compensation

     180        158        335        264   

Corporate Expenses

     4,845        5,039        10,085        10,376   

Corporate Expenses - Non-Cash Compensation

     776        1,163        1,763        2,454   

Depreciation And Amortization

     2,192        2,737        4,516        5,496   

Impairment Loss

     850        22,307        850        22,307   

Net Time Brokerage Agreement Fees

     —          242        —          242   

Net (Gain) Loss On Sale Or Disposition of Assets

     (1,613     (13     (1,591     3   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Operating Expenses

     72,971        99,203        139,559        168,279   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

     28,268        5,368        40,040        16,258   
  

 

 

   

 

 

   

 

 

   

 

 

 

Other Expense (Income) Items:

      

Net Interest Expense

     11,310        13,496        22,784        27,569   

Net Gain On Derivative Instruments

     —          (558     —          (1,346

Other Income

     (62     (33     (93     (46
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Other Expense

     11,248        12,905        22,691        26,177   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (Loss) Before Income Taxes (Benefit)

     17,020        (7,537     17,349        (9,919

Income Taxes (Benefit)

     7,127        (4,330     7,707        (5,663
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income (Loss)

   $ 9,893      $ (3,207   $ 9,642      $ (4,256
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income (Loss) Per Share - Basic

   $ 0.26      $ (0.09   $ 0.26      $ (0.12
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income (Loss) Per Share - Diluted

   $ 0.26      $ (0.09   $ 0.25      $ (0.12
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted Common Shares Outstanding - Basic

     37,344        36,686        37,308        36,668   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted Common Shares Outstanding - Diluted

     38,103        36,686        38,201        36,668   
  

 

 

   

 

 

   

 

 

   

 

 

 

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

      

Capital Expenditures

   $ 1,465      $ 81      $ 2,428        962   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income Taxes Paid

   $ 68      $ —        $ 69        99   
  

 

 

   

 

 

   

 

 

   

 

 

 

Cash Interest

   $ 17,293      $ 18,937      $ 21,925        25,963   
  

 

 

   

 

 

   

 

 

   

 

 

 

SELECTED BALANCE SHEET DATA

      
     June 30,              
     2013     2012        

Cash And Cash Equivalents

   $ 6,339      $ 6,741     
  

 

 

   

 

 

     

Total Assets

   $ 909,578      $ 923,589     
  

 

 

   

 

 

     

Current Portion Of Senior Debt

   $ 18,027      $ 15,738     
  

 

 

   

 

 

     

Senior Debt (including Current Debt)

   $ 328,077      $ 393,607     
  

 

 

   

 

 

     

Senior Notes

   $ 217,483      $ 217,223     
  

 

 

   

 

 

     

Total Shareholders’ Equity

   $ 275,497      $ 249,230     
  

 

 

   

 

 

     

 

Exhibit 99.1 - Page 5


OTHER FINANCIAL DATA

        
     Three Months Ended
June 30,
    Six Months Ended
June 30,
 
     2013     2012     2013     2012  

Reconciliation Of GAAP Station Operating Expenses To Station Expenses

        

Station Operating Expenses

   $ 65,921      $ 67,728      $ 123,936      $ 127,401   

Station Expenses - Non-Cash Compensation

     (180     (158     (335     (264
  

 

 

   

 

 

   

 

 

   

 

 

 

Station Expenses

   $ 65,741      $ 67,570      $ 123,601      $ 127,137   
  

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation Of GAAP Corporate General & Administrative Expenses To Corporate Expenses

        

Corporate General & Administrative Expenses

   $ 5,621      $ 6,202      $ 11,848      $ 12,830   

Corporate Expenses - Non-Cash Compensation

     (776     (1,163     (1,763     (2,454
  

 

 

   

 

 

   

 

 

   

 

 

 

Corporate Expenses

   $ 4,845      $ 5,039      $ 10,085      $ 10,376   
  

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation Of GAAP Operating Income To Station Operating Income

        

Operating Income

   $ 28,268      $ 5,368      $ 40,040      $ 16,258   

Corporate Expenses

     4,845        5,039        10,085        10,376   

Corporate Expenses - Non-Cash Compensation

     776        1,163        1,763        2,454   

Station Expenses - Non-Cash Compensation

     180        158        335        264   

Depreciation And Amortization

     2,192        2,737        4,516        5,496   

Impairment Loss

     850        22,307        850        22,307   

Net Time Brokerage Agreement Fees

     —          242        —          242   

Net (Gain) Loss On Sale Or Disposition of Assets

     (1,613     (13     (1,591     3   
  

 

 

   

 

 

   

 

 

   

 

 

 

Station Operating Income

   $ 35,498      $ 37,001      $ 55,998      $ 57,400   
  

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation Of GAAP Net Income (Loss) To Adjusted EBITDA

        

Net Income (Loss)

   $ 9,893      $ (3,207   $ 9,642      $ (4,256

Income Taxes (Benefit)

     7,127        (4,330     7,707        (5,663

Total Other Expense

     11,248        12,905        22,691        26,177   

Corporate Expenses - Non-Cash Compensation

     776        1,163        1,763        2,454   

Station Expenses - Non-Cash Compensation

     180        158        335        264   

Depreciation And Amortization

     2,192        2,737        4,516        5,496   

Impairment Loss

     850        22,307        850        22,307   

Net Time Brokerage Agreement Fees

     —          242        —          242   

Net (Gain) Loss On Sale Or Disposition of Assets

     (1,613     (13     (1,591     3   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

   $ 30,653      $ 31,962      $ 45,913      $ 47,024   
  

 

 

   

 

 

   

 

 

   

 

 

 
     Three Months Ended
June 30,
    Six Months Ended
June 30,
 
     2013     2012     2013     2012  

Reconciliation Of GAAP Net Income (Loss) To Free Cash Flow

        

Net Income (Loss)

   $ 9,893      $ (3,207   $ 9,642      $ (4,256

Depreciation And Amortization

     2,192        2,737        4,516        5,496   

Impairment Loss

     850        22,307        850        22,307   

Deferred Financing Costs Included In Interest Expense

     1,010        1,054        2,053        2,172   

Amortization Of Original Issue Discount Included In Interest Expense

     68        61        133        120   

Non-Cash Compensation Expense

     956        1,321        2,098        2,718   

Net (Gain) Loss On Sale Or Disposition of Assets

     (1,613     (13     (1,591     3   

Net Gain On Derivative Instruments

     —          (558     —          (1,346

Other Income

     (62     (33     (93     (46

Income Taxes (Benefit)

     7,127        (4,330     7,707        (5,663

Capital Expenditures

     (1,465     (81     (2,428     (962

Income Taxes Paid

     (68     —          (69     (99
  

 

 

   

 

 

   

 

 

   

 

 

 

Free Cash Flow

   $ 18,888      $ 19,258      $ 22,818      $ 20,444   
  

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation Of GAAP Operating Income To Free Cash Flow:

        

Operating Income

   $ 28,268      $ 5,368      $ 40,040      $ 16,258   

Depreciation and Amortization

     2,192        2,737        4,516        5,496   

Non-Cash Compensation Expense

     956        1,321        2,098        2,718   

Impairment Loss

     850        22,307        850        22,307   

Interest Expense, Net of Interest Income, Deferred Financing Costs & OID

     (10,232     (12,381     (20,598     (25,277

Capital Expenditures

     (1,465     (81     (2,428     (962

Net (Gain) Loss On Sale Or Disposition of Assets

     (1,613     (13     (1,591     3   

Income Taxes Paid

     (68     —          (69     (99
  

 

 

   

 

 

   

 

 

   

 

 

 

Free Cash Flow

   $ 18,888      $ 19,258      $ 22,818      $ 20,444   
  

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation Of GAAP Net Income (Loss) To Adjusted Net Income

        

Net Income (Loss)

   $ 9,893      $ (3,207   $ 9,642      $ (4,256

Income Taxes (Benefit)

     7,127        (4,330     7,707        (5,663

Net (Gain) Loss On Sale Or Disposition of Assets

     (1,613     (13     (1,591     3   

Impairment Loss

     850        22,307        850        22,307   

Net Gain On Derivative Instruments

     —          (558     —          (1,346

Other Income

     (62     (33     (93     (46

Non-Cash Compensation Expense

     956        1,321        2,098        2,718   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Income (Loss) Before Income Taxes (Benefit)

     17,151        15,487        18,613        13,717   

Income Taxes (Benefit)

     7,203        6,505        7,817        5,761   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Net Income

   $ 9,948      $ 8,982      $ 10,796      $ 7,956   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted Average Diluted Shares Outstanding

        

Weighted Average Diluted Shares Outstanding - Diluted, As Reported

     38,103        36,686        38,201        36,668   

Shares Considered Anti-Dilutive When Reporting A Net Loss

     —          913        —          1,025   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted Average Diluted Shares Outstanding - Diluted

     38,103        37,599        38,201        37,693   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Net Income (Loss) Per Share - Diluted

   $ 0.26      $ 0.24      $ 0.28      $ 0.21   
  

 

 

   

 

 

   

 

 

   

 

 

 

 

Exhibit 99.1 - Page 6