Spanish Broadcasting System, Inc. (the "Company" or "SBS")
(Nasdaq:SBSA) today reported financial results for the first
quarter ended March 31, 2015.
Financial Highlights
|
Quarter
Ended |
|
(in thousands) |
March
31, |
% |
|
2015 |
2014 |
Change |
|
|
Net revenue: |
|
|
|
Radio |
$ 29,227 |
29,445 |
(1%) |
Television |
2,915 |
3,334 |
(13%) |
Consolidated |
$ 32,142 |
32,779 |
(2%) |
|
|
|
|
OIBDA, a non-GAAP
measure*: |
|
|
|
Radio |
$ 10,180 |
10,285 |
(1%) |
Television |
(964) |
(772) |
25% |
Corporate |
(2,148) |
(1,704) |
26% |
Consolidated |
$ 7,068 |
7,809 |
(9%) |
* Please refer to the Non-GAAP Financial
Measures section for a definition of OIBDA and a reconciliation
from OIBDA to the most directly comparable GAAP financial
measure.
Discussion and Results
"During the first quarter, our AIRE Radio Network platform
expanded its revenues as we continued to benefit from our broader
reach and leading content offerings," commented Raúl Alarcón, Jr.,
Chairman and CEO. "Our radio stations also continue to rank among
the most successful platforms serving the Spanish-speaking
population in the nation's largest Hispanic media markets. On the
digital side, we remain focused on strengthening our capabilities
and integrated offerings as we look to attract new advertising
partners and expand our revenue streams. Looking ahead, we will
continue to execute our strategy of leveraging our strong audience
shares and multi-media assets to connect advertisers with the
rapidly expanding Latino population."
Quarter End Results
For the quarter-ended March 31, 2015, consolidated net revenues
totaled $32.1 million compared to $32.8 million for the same prior
year period, resulting in a decrease of 2%. Our radio segment
net revenues decreased $0.2 million or 1%, due to decreases in
national, local and barter sales, which were partially offset by an
increase in network sales. Our national sales decreased in our Los
Angeles, New York, San Francisco and Puerto Rico markets. Our
local sales decreased in our Los Angeles and Puerto Rico markets
and the decrease in barter sales occurred throughout all of our
markets. Our network sales increase was directly related to
our "AIRE Radio Network" advertising platform, which we launched in
the beginning of 2014. Our television segment net
revenues decreased $0.4 million or 13%, due to the decreases in
paid-programming, and local, barter and national spot
sales.
Consolidated OIBDA, a non-GAAP measure, totaled $7.1 million
compared to $7.8 million for the same prior year period,
representing a decrease of 9%. Our radio segment OIBDA decreased
$0.1 million, primarily due to the decrease in net revenues of $0.2
million, partially offset by the decrease in operating expenses of
$0.1 million. Radio station operating expenses decreased
mainly due to decreases in barter expenses and professional fees,
which were offset by an increase in special events expenses.
Our television segment OIBDA decreased $0.2 million,
due to the decrease in net revenues of $0.4 million, partially
offset by the decrease in operating expenses of $0.2 million.
Television station operating expenses decreased primarily due to
decreases in professional fees and barter expenses, which were
offset by an increase in special events expenses. Our
corporate expenses increased $0.4 million or 26%, mostly due to
increases in professional fees, compensation and benefits, and
directors & officers insurance premiums.
Operating income totaled $5.8 million compared to $6.5 million
for the same prior year period, representing a decrease of $0.7
million or 11%. This decrease in operating income was
primarily due to the decrease in net revenue.
First Quarter 2015 Conference Call
We will host a conference call to discuss our first quarter 2015
financial results on Monday, May 18, 2015 at 11:00 a.m. Eastern
Time. To access the teleconference, please dial 412-317-6789
ten minutes prior to the start time.
If you cannot listen to the teleconference at its scheduled
time, there will be a replay available through Monday, June 1,
2015, which can be accessed by dialing 877-344-7529 (U.S.) or
412-317-0088 (Int'l), passcode: 10065619.
There will also be a live webcast of the teleconference, located
on the investor portion of our corporate Web site, at
www.spanishbroadcasting.com/webcasts.shtml. A seven day archived
replay of the webcast will also be available at that
link.
About Spanish Broadcasting System, Inc.
Spanish Broadcasting System, Inc. is the largest publicly traded
Hispanic-controlled media and entertainment company in the United
States. SBS owns 20 radio stations located in the top U.S.
Hispanic markets of New York, Los Angeles, Miami, Chicago, San
Francisco and Puerto Rico, airing the Spanish Tropical, Regional
Mexican, Spanish Adult Contemporary, Top 40 and Latin Rhythmic
format genres. SBS also operates AIRE Radio Network, a national
radio platform which creates, distributes and markets leading
Spanish-language radio programming to over 100 affiliated stations
reaching 88% of the U.S. Hispanic audience. SBS also owns
MegaTV, a television operation with over-the-air, cable and
satellite distribution and affiliates throughout the U.S. and
Puerto Rico. SBS also produces live concerts and events and owns 21
bilingual websites, including www.LaMusica.com, an online
destination and mobile app providing content related to Latin
music, entertainment, news and culture. For more information, visit
us online at www.spanishbroadcasting.com.
This press release contains certain forward-looking
statements. These forward-looking statements, which are
included in accordance with the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995, may involve known
and unknown risks, uncertainties and other factors that may cause
the Company's actual results and performance in future periods to
be materially different from any future results or performance
suggested by the forward-looking statements in this press
release. Although the Company believes the expectations
reflected in such forward-looking statements are based upon
reasonable assumptions, it can give no assurance that actual
results will not differ materially from these
expectations. Forward-looking statements, which are based upon
certain assumptions and describe future plans, strategies and
expectations of the Company, are generally identifiable by use of
the words "may," "will," "expect," "believe," "anticipate,"
"intend," "could," "estimate," "might," or "continue" or the
negative or other variations thereof or comparable
terminology. Factors that could cause actual results, events
and developments to differ are included from time to time in the
Company's public reports filed with the Securities and Exchange
Commission. All forward-looking statements made herein are
qualified by these cautionary statements and there can be no
assurance that the actual results, events or developments
referenced herein will occur or be realized. The Company undertakes
no obligation to update or revise forward-looking statements to
reflect changed assumptions, the occurrence of unanticipated events
or changes to future operating results.
Below are the Unaudited Condensed Consolidated
Statements of Operations for the quarter ended March 31, 2015 and
2014.
|
Quarter
Ended |
|
March
31, |
Amounts in thousands, except per share
amounts |
2015 |
2014 |
|
|
|
|
(Unaudited) |
Net revenue |
$ 32,142 |
32,779 |
Station operating expenses |
22,926 |
23,266 |
Corporate expenses |
2,148 |
1,704 |
Depreciation and amortization |
1,287 |
1,275 |
(Gain) loss on the disposal of assets,
net |
(6) |
46 |
Operating income |
5,787 |
6,488 |
Interest expense, net |
(9,933) |
(9,928) |
Dividends on Series B preferred stock
classified as interest expense |
(2,433) |
(2,433) |
Loss before income taxes |
(6,579) |
(5,873) |
Income tax expense |
2,036 |
214 |
Net loss |
$ (8,615) |
(6,087) |
|
|
|
Net loss per common share: |
|
|
Basic & Diluted |
$ (1.19) |
(0.84) |
|
|
|
Weighted average common shares
outstanding: |
|
|
Basic & Diluted |
7,267 |
7,267 |
Non-GAAP Financial Measures
Operating Income (Loss) before Depreciation and Amortization,
(Gain) Loss on the Disposal of Assets, net, and Impairment Charges
and Restructuring Costs ("OIBDA") is not a measure of performance
or liquidity determined in accordance with Generally Accepted
Accounting Principles ("GAAP") in the United States. However,
we believe that this measure is useful in evaluating our
performance because it reflects a measure of performance for our
stations before considering costs and expenses related to our
capital structure and dispositions. This measure is widely
used in the broadcast industry to evaluate a company's operating
performance and is used by us for internal budgeting purposes and
to evaluate the performance of our stations, segments, management
and consolidated operations. However, this measure should not
be considered in isolation or as a substitute for Operating Income,
Net Income, Cash Flows from Operating Activities or any other
measure used in determining our operating performance or liquidity
that is calculated in accordance with GAAP. In addition, because
OIBDA is not calculated in accordance with GAAP, it is not
necessarily comparable to similarly titled measures used by other
companies.
Included below are tables that reconcile OIBDA to operating
income (loss) for each segment and consolidated operating income
(loss), which is the most directly comparable GAAP financial
measure.
|
Quarter Ended
March 31, 2015 |
(Unaudited and in thousands) |
Consolidated |
Radio |
Television |
Corporate |
|
|
|
|
|
OIBDA |
$ 7,068 |
10,180 |
(964) |
(2,148) |
Less expenses excluded from OIBDA but
included in operating income (loss): |
|
|
|
|
Depreciation and amortization |
1,287 |
507 |
684 |
96 |
(Gain) loss on the disposal of assets,
net |
(6) |
(6) |
-- |
-- |
Operating Income (Loss) |
$ 5,787 |
9,679 |
(1,648) |
(2,244) |
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended
March 31, 2014 |
(Unaudited and in thousands) |
Consolidated |
Radio |
Television |
Corporate |
|
|
|
|
|
OIBDA |
$ 7,809 |
10,285 |
(772) |
(1,704) |
Less expenses excluded from OIBDA but
included in operating income (loss): |
|
|
|
|
Depreciation and amortization |
1,275 |
501 |
691 |
83 |
Loss (gain) on the disposal of assets,
net |
46 |
46 |
-- |
-- |
Operating Income (Loss) |
$ 6,488 |
9,738 |
(1,463) |
(1,787) |
Unaudited Segment Data
We have two reportable segments: radio and television. The
following summary table presents separate financial data for each
of our operating segments:
|
Quarter
Ended |
|
March
31, |
|
2015 |
2014 |
|
(In
thousands) |
Net revenue: |
|
|
Radio |
$ 29,227 |
29,445 |
Television |
2,915 |
3,334 |
Consolidated |
$ 32,142 |
32,779 |
|
|
|
Engineering and programming
expenses: |
|
|
Radio |
$ 5,399 |
5,073 |
Television |
2,265 |
2,439 |
Consolidated |
$ 7,664 |
7,512 |
|
|
|
Selling, general and administrative
expenses: |
|
|
Radio |
$ 13,648 |
14,087 |
Television |
1,614 |
1,667 |
Consolidated |
$ 15,262 |
15,754 |
|
|
|
Corporate expenses: |
$ 2,148 |
1,704 |
|
|
|
Depreciation and
amortization: |
|
|
Radio |
$ 507 |
501 |
Television |
684 |
691 |
Corporate |
96 |
83 |
Consolidated |
$ 1,287 |
1,275 |
|
|
|
(Gain) loss on the disposal of
assets, net: |
|
|
Radio |
$ (6) |
46 |
Television |
-- |
-- |
Corporate |
-- |
-- |
Consolidated |
$ (6) |
46 |
|
|
|
Operating income
(loss): |
|
|
Radio |
$ 9,679 |
9,738 |
Television |
(1,648) |
(1,463) |
Corporate |
(2,244) |
(1,787) |
Consolidated |
$ 5,787 |
6,488 |
Selected Unaudited Balance Sheet Information and Other
Data:
|
As of |
|
(Amounts in thousands) |
March 31, 2015 |
|
|
|
|
Cash and cash equivalents |
$ 31,903 |
|
|
|
|
Total assets |
$ 456,804 |
|
|
|
|
12.5% Senior Secured Notes due 2017, net |
$ 271,069 |
|
Other debt |
5,173 |
|
Total debt |
$ 276,242 |
|
|
|
|
Series B preferred stock |
$ 90,549 |
|
Accrued Series B preferred stock dividends
payable |
48,264 |
|
Total |
$ 138,813 |
|
|
|
|
Total stockholders' deficit |
$ (82,788) |
|
|
|
|
Total capitalization |
$ 332,267 |
|
|
|
|
|
|
|
|
For the
Year Ended March 31, |
|
2015 |
2014 |
|
|
|
Capital expenditures |
$ 285 |
611 |
Cash paid for income taxes |
$ 34 |
-- |
CONTACT: Analysts and Investors
Jose I. Molina
Vice President of Finance
(305) 441-6901
Analysts, Investors or Media
Brad Edwards
Brainerd Communicators, Inc.
(212) 986-6667
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