Gray Television, Inc. (“Gray,” “we,” “us” or “our”) (NYSE:
GTN) today announces record results of operations for the
three-months and full year ended December 31, 2018, including
strong net income and record revenue and Broadcast Cash Flow (a
non-GAAP financial measure, defined below). Our diluted net income
per share for the fourth quarter of 2018 was $1.00. Excluding the
$8.5 million of transaction costs discussed below, our adjusted
diluted net income per share would have been $1.06 in the fourth
quarter of 2018.
Financial Highlights, Selected Operating Data and Other
Recent Developments:
- Strong Net Income and Record Fourth Quarter Revenue and
Broadcast Cash Flow - Our net income was $88.3 million in the
fourth quarter of 2018, and was our second best fourth quarter net
income. Our revenue and Broadcast Cash Flow for the fourth quarter
of 2018 were each record results. Our revenue was $328.2 million,
increasing $94.6 million, or 40%, from the fourth quarter of 2017,
and was our all-time best quarterly revenue. Our Broadcast Cash
Flow was $172.8 million, increasing $87.1 million, or 102%, from
the fourth quarter of 2017, and was our all-time best quarterly
result.
- Political Revenue – Our political advertising revenue was $83.2
million for the fourth quarter of 2018. For comparison, after
giving effect to stations acquired and divested from January 1,
2014 through December 31, 2018, we earned $79.5 million of
political advertising revenue in the fourth quarter of 2014, which
was the most recent non-presidential election year. Our political
advertising revenue for the fourth quarter of 2018 was
approximately 5% greater than that of the fourth quarter of 2014,
on this adjusted basis.
- Retransmission Revenue, Expense and Net - Our gross
retransmission revenue for the fourth quarter of 2018 was $93.0
million, and our retransmission expense was $42.7 million.
Therefore, our retransmission revenue, net of retransmission
expense, was $50.3 million for the fourth quarter of 2018. For
calendar year 2018, gross retransmission revenue was $355.4 million
and retransmission revenue net of retransmission expense, was
$190.4 million.
- Total Leverage Ratio, Net of all Cash - As of December 31,
2018, our total leverage ratio, as defined in our senior credit
facility (as discussed further below), was 3.01 times on a trailing
eight-quarter basis after netting our total cash (excluding
restricted cash) balance of $667.0 million.
- Merger with Raycom Media, Inc. – On January 2, 2019, we
completed the merger with Raycom Media, Inc. (“Raycom”), the
related acquisitions of stations KYOU-TV and WUPV-TV and the
divestiture of eight Raycom stations due to market overlaps
(together, the “Raycom Merger”). Giving effect to the Raycom
Merger, we own and/or operate television stations in 91 markets
broadcasting almost 400 affiliates including nearly 150 affiliates
of the ABC/NBC/CBS/FOX networks, as well as other networks and
program streams. These stations are the number-one or number-two
ranked stations in 86 of the 91 markets. In addition to the high
quality television stations acquired as part of the merger, we also
acquired businesses that provide sports marketing and production
services, that we believe has made us a more diversified media
company.
- Financing for the Raycom Merger– In connection with the Raycom
Merger, we completed several financing transactions:
- On November 16, 2018, we completed the offering of $750.0
million of 7.0% unsecured notes due 2027 (the “2027 Notes”) by our
special purpose wholly-owned subsidiary. We assumed all
obligations of the 2027 Notes upon completion of the Raycom Merger
on January 2, 2019. As of December 31, 2018, the proceeds from this
offering were held in escrow.
- On January 2, 2019:
- We amended our senior credit facility, pursuant to which we
borrowed $1.4 billion of additional secured term loan financing and
increased our un-drawn revolving credit facility to $200.0
million,
- We issued $650.0 million of our 8.0% Series A Perpetual
Preferred Stock, and
- We issued 11.5 million shares of our common stock valued at
$169.5 million.
- Network Affiliation Renewals. Coincident with and in the weeks
after the Raycom Merger, we entered into agreements with the ABC
network, CBS network and NBC network that extend the terms of the
affiliation agreements for all ABC, CBS and NBC affiliated stations
acquired in the Raycom Merger as well as the ABC affiliations for
all of the legacy Gray stations.
- United Acquisition. On February 8, 2019, we announced that we
entered into an agreement with United Communications, Inc. to
acquire all three of its television stations for $45.0 million.
Those stations are WWNY-TV (CBS) and WNYF-CD (FOX) in Watertown,
New York (DMA 178) and KEYC-TV (CBS/FOX) in Mankato, Minnesota (DMA
199).
- Key Vendor Agreements. In January 2019, we expanded our
relationship with Comscore, Inc. for local audience measurement for
the entire legacy Gray footprint and for the majority of Raycom’s
legacy footprint. Conversely, Gray’s stations in the Comscore
markets will no longer acquire audience measurement services from
Nielsen Co. In addition, we entered into an agreement to terminate
the national advertising sales representation agreements that cover
all television stations that we acquired in the Raycom Merger. As a
result of this termination, we incurred a termination expense of
approximately $27.6 million in the first quarter of 2019. Beginning
on February 25, 2019, the former Raycom stations will join the
legacy Gray stations in handling all local, regional, and national
business directly with their buyers.
Selected
Operating Data on As-Reported Basis (unaudited): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, |
|
2018 |
|
2017 |
|
% Change 2018 to 2017 |
|
2016 |
|
% Change 2018 to 2016 |
|
(dollars in thousands) |
Revenue (less agency
commissions): |
|
|
|
|
|
|
|
|
|
Total |
$ |
328,220 |
|
$ |
233,609 |
|
40 % |
|
$ |
237,619 |
|
38 % |
Political |
$ |
83,211 |
|
$ |
7,464 |
|
1015 % |
|
$ |
48,519 |
|
72 % |
|
|
|
|
|
|
|
|
|
|
Operating expenses
(1)(3): |
|
|
|
|
|
|
|
|
|
Broadcast |
$ |
159,739 |
|
$ |
150,782 |
|
6 % |
|
$ |
128,476 |
|
24 % |
Corporate
and administrative |
$ |
10,776 |
|
$ |
7,117 |
|
51 % |
|
$ |
8,912 |
|
21 % |
|
|
|
|
|
|
|
|
|
|
Net income |
$ |
88,267 |
|
$ |
165,570 |
|
(47)% |
|
$ |
35,834 |
|
146 % |
|
|
|
|
|
|
|
|
|
|
Non-GAAP Cash Flow
(2): |
|
|
|
|
|
|
|
|
|
Broadcast
Cash Flow (3) |
$ |
172,844 |
|
$ |
85,755 |
|
102 % |
|
$ |
109,502 |
|
58 % |
Broadcast
Cash Flow Less Cash Corporate Expenses (3) |
$ |
163,526 |
|
$ |
79,814 |
|
105 % |
|
$ |
101,560 |
|
61 % |
Free Cash
Flow |
$ |
97,836 |
|
$ |
40,383 |
|
142 % |
|
$ |
68,486 |
|
43 % |
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, |
|
2018 |
|
2017 |
|
% Change 2018 to 2017 |
|
2016 |
|
% Change 2018 to 2016 |
|
(dollars in thousands) |
Revenue (less agency
commissions): |
|
|
|
|
|
|
|
|
|
Total |
$ |
1,084,132 |
|
$ |
882,728 |
|
23 % |
|
$ |
812,465 |
|
34 % |
Political |
$ |
155,074 |
|
$ |
16,498 |
|
840 % |
|
$ |
90,095 |
|
72 % |
|
|
|
|
|
|
|
|
|
|
Operating expenses
(1)(3): |
|
|
|
|
|
|
|
|
|
Broadcast |
$ |
596,403 |
|
$ |
557,563 |
|
7 % |
|
$ |
474,994 |
|
26 % |
Corporate
and administrative |
$ |
40,910 |
|
$ |
31,589 |
|
30 % |
|
$ |
40,319 |
|
1 % |
|
|
|
|
|
|
|
|
|
|
Net income |
$ |
210,803 |
|
$ |
261,952 |
|
(20)% |
|
$ |
62,273 |
|
239 % |
|
|
|
|
|
|
|
|
|
|
Non-GAAP Cash Flow
(2): |
|
|
|
|
|
|
|
|
|
Broadcast
Cash Flow (3) |
$ |
493,359 |
|
$ |
329,057 |
|
50 % |
|
$ |
338,938 |
|
46 % |
Broadcast
Cash Flow Less Cash Corporate Expenses (3) |
$ |
457,392 |
|
$ |
301,873 |
|
52 % |
|
$ |
302,497 |
|
51 % |
Free Cash
Flow |
$ |
262,554 |
|
$ |
171,004 |
|
54 % |
|
$ |
148,126 |
|
77 % |
|
|
|
|
|
|
|
|
|
|
- Excludes depreciation, amortization and (gain) loss on disposal
of assets.
- See definition of non-GAAP terms and a reconciliation of the
non-GAAP amounts to net income included elsewhere herein.
- Amounts in 2017 and 2016 have been reclassified to give effect
to the implementation of Accounting Standards Update 2017-07,
Compensation – Retirement Benefits (Topic 715) – Improving the
Presentation of Net Periodic Pension Cost and Net Postretirement
Benefit Cost (“ASU 2017-07”).
Results of Operations for the Fourth Quarter of
2018:
Revenue (Less Agency Commissions).
The table below presents our revenue (less agency commissions)
by type for the fourth quarter of 2018 and 2017 (dollars in
thousands):
|
|
Three Months Ended December 31, |
|
|
2018 |
|
2017 |
|
Amount |
|
Percent |
|
|
|
|
Percent |
|
|
|
Percent |
|
Increase |
|
Increase |
|
|
Amount |
|
of Total |
|
Amount |
|
of Total |
|
(Decrease) |
|
(Decrease) |
Revenue (less
agency commissions): |
|
|
|
|
|
|
|
|
|
|
|
|
Local
(including internet/digital/mobile) |
|
$ |
117,409 |
|
35.8% |
|
$ |
120,714 |
|
51.7% |
|
$ |
(3,305) |
|
(3)% |
National |
|
30,608 |
|
9.3% |
|
31,995 |
|
13.7% |
|
(1,387) |
|
(4)% |
Political |
|
83,211 |
|
25.4% |
|
7,464 |
|
3.2% |
|
75,747 |
|
1015 % |
Retransmission consent |
|
92,962 |
|
28.3% |
|
69,509 |
|
29.8% |
|
23,453 |
|
34 % |
Other |
|
4,030 |
|
1.2% |
|
3,927 |
|
1.6% |
|
103 |
|
3 % |
Total |
|
$ |
328,220 |
|
100.0% |
|
$ |
233,609 |
|
100.0% |
|
$ |
94,611 |
|
40 % |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue increased by $94.6 million or 40% in the fourth
quarter of 2018 as compared to the fourth quarter of 2017. Total
revenue increased primarily as a result of increased political
advertising revenue due to 2018 being the “on-year” of the two-year
election cycle and increased retransmission consent revenue, due
primarily to increased retransmission consent rates.
Broadcast Operating
Expenses.
Broadcast operating expenses (before depreciation, amortization
and gain or loss on disposal of assets) increased $9.0 million, or
6%, to $159.7 million for the fourth quarter of 2018 compared to
the fourth quarter of 2017. The increase reflects, in part, the
following:
- Non-compensation expenses increased $10.8 million, or 15%, in
the 2018 period primarily as a result of an increase in
retransmission expense of $7.1 million or 20%, to $42.7 million and
increases in bank fees, related to credit card collections, of $1.5
million and bad debt expense of $1.7 million in the fourth quarter
of 2018.
- Compensation expense decreased $1.8 million in the 2018 period,
primarily due to reductions in staffing. Non-cash stock-based
compensation expenses were $0.3 million and $2.8 million in the
fourth quarters of 2018 and 2017, respectively.
Corporate and Administrative Operating
Expenses.
Corporate and administrative operating expenses (before
depreciation, amortization and gain or loss on disposal of assets)
increased $3.7 million, or 51%, to $10.8 million in the fourth
quarter of 2018 compared to the fourth quarter of 2017. The
increase reflects the following:
- Non-compensation expenses increased $3.0 million, or 91%, in
the fourth quarter of 2018 primarily as a result of an increase in
professional fees of $2.4 million related to acquisition
activities.
- Compensation expenses increased $0.6 million, or 17%, in the
fourth quarter of 2018 due primarily to increases in incentive
compensation costs. Non-cash stock-based compensation expenses were
$1.3 million and $1.2 million in the fourth quarters of 2018 and
2017, respectively.
Gain or Loss on Disposal of Assets, net.
- We reported gains on disposals of assets of $11.2 million in
the fourth quarter of 2018 that included a $4.8 million gain
related to the divestiture of WSWG-TV and $6.4 million primarily
related to the on-going FCC Repack process. As WSWG-TV was in a
market that overlapped with the operations of a Raycom owned
television station, its divestiture was required for regulatory
approval of the Raycom Merger.
Taxes.
We made aggregate federal and state income tax payments, net of
refunds, of $7.2 million in the fourth quarter of 2018 compared to
$0.8 million in the fourth quarter of 2017.
Results of Operations for the Year Ended
December 31, 2018:
Revenue (Less Agency Commissions).
The table below presents our revenue (less agency commissions)
by type for the years ended December 31, 2018 and 2017,
respectively (dollars in thousands):
|
|
Year Ended December 31, |
|
|
2018 |
|
2017 |
|
Amount |
|
Percent |
|
|
|
|
Percent |
|
|
|
Percent |
|
Increase |
|
Increase |
|
|
Amount |
|
of Total |
|
Amount |
|
of Total |
|
(Decrease) |
|
(Decrease) |
Revenue (less
agency commissions): |
|
|
|
|
|
|
|
|
|
|
|
|
Local
(including internet/digital/mobile) |
|
$ |
442,728 |
|
40.8% |
|
$ |
451,261 |
|
51.1% |
|
$ |
(8,533) |
|
(2)% |
National |
|
114,192 |
|
10.5% |
|
118,817 |
|
13.5% |
|
(4,625) |
|
(4)% |
Political |
|
155,074 |
|
14.3% |
|
16,498 |
|
1.9% |
|
138,576 |
|
840 % |
Retransmission consent |
|
355,423 |
|
32.8% |
|
276,603 |
|
31.3% |
|
78,820 |
|
28 % |
Other |
|
16,715 |
|
1.6% |
|
19,549 |
|
2.2% |
|
(2,834) |
|
(14)% |
Total |
|
$ |
1,084,132 |
|
100.0% |
|
$ |
882,728 |
|
100.0% |
|
$ |
201,404 |
|
23 % |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue increased $201.4 million or 23% to $1.1 billion in
the year ended December 31, 2018, compared to the year ended
December 31, 2017. Total revenue increased primarily as a result of
increased political advertising revenue due to 2018 being the
“on-year” of the two-year election cycle and increased
retransmission consent revenue, due primarily to increased
retransmission consent rates. Local and national advertising
revenue decreased slightly, in spite of the $2.3 million of revenue
we earned from the broadcast of the 2018 Super Bowl on our
NBC-affiliated stations, compared to $0.6 million that we earned
from the broadcast of the 2017 Super Bowl on our
FOX-affiliated stations. In addition, revenue from the broadcast of
the 2018 Winter Olympic Games on our NBC-affiliated stations was
approximately $5.5 million.
Broadcast Operating Expenses.
Broadcast operating expenses (before depreciation, amortization
and gain or loss on disposal of assets) increased $38.8 million, or
7%, to $596.4 million for the year ended December 31, 2018 compared
to the year ended December 31, 2017. The increase reflects, in
part, the following:
- Non-compensation expenses increased by $37.5 million, or 13%,
in 2018, primarily as the result of increased retransmission
expense of $28.5 million, or 21%, to $165.0 million in 2018 and net
increases in several other expense categories including
programming, professional fees and credit and collection costs. Our
programming costs related to the broadcast of the 2018 Winter
Olympic Games were $1.5 million.
- Compensation expenses increased $1.3 million, or less than 1%,
in 2018. Including the effect of a $0.5 million adjustment related
to forfeitures, our non-cash stock-based compensation expenses were
$1.9 million and $3.9 million in 2018 and 2017, respectively.
Corporate and Administrative Operating
Expenses.
Corporate and administrative operating expenses (before
depreciation, amortization and gain or loss on disposal of assets)
increased $9.3 million, or 30%, to $40.9 million for the year ended
December 31, 2018 compared to the year ended December 31, 2017.
This increase reflects in part the following:
- Non-compensation expense increased $7.6 million, or 46%, due
primarily to increases of $7.3 million of professional fees related
to acquisition activities in 2018.
- Compensation expenses increased $1.8 million, or 12%, primarily
as a result of increases in incentive compensation. Non-cash
stock-based compensation expenses were $4.8 million in 2018
compared to $4.4 million in 2017.
Gain or Loss on Disposal of Assets, net.
We reported gains on disposals of assets of $16.4 million in the
year ended December 31, 2018 that included a gain of $4.8 million
related to the divestiture of WSWG-TV and $14.2 million related to
the on-going FCC Repack process. In the year ended December 31,
2017, we recorded a net gain of $74.2 million. This gain was
primarily related to the FCC Spectrum Auction, in which we tendered
two of our television broadcast licenses and made other
modifications to our broadcast spectrum. Our proceeds from this
auction were $90.8 million and the cost of the assets disposed was
$13.1 million.
Loss from Early Extinguishment of Debt.
In the year ended December 31, 2017, we recorded an
approximately $2.9 million loss from early extinguishment of debt
related to the amendment and restatement of our senior credit
facility.
Taxes.
During the year ended December 31, 2018, we made aggregate
federal and state income tax payments totaling $34.2 million
compared to $2.0 million for the year ended December 31, 2017. We
recorded a provision for income taxes of $76.8 million in the year
ended December 31, 2018. In the year ended December 31, 2017, we
recorded a tax benefit of $68.7 million, primarily as a result of
U.S. tax reform legislation known as the Tax Cuts and Jobs Act.
Detailed table of operating results on As-Reported
Basis:
Gray Television, Inc. |
Selected Operating Data
(Unaudited) |
(in thousands except for net income per share
data) |
|
|
|
|
|
Three Months Ended |
|
Year Ended |
|
December 31, |
|
December 31, |
|
|
|
|
|
|
|
|
|
2018 |
|
2017 |
|
2018 |
|
2017 |
|
|
|
|
|
|
|
|
Revenue (less agency
commissions) |
$ |
328,220 |
|
$ |
233,609 |
|
$ |
1,084,132 |
|
$ |
882,728 |
Operating expenses
before depreciation, |
|
|
|
|
|
|
|
amortization and (gain) loss on disposal |
|
|
|
|
|
|
|
of
assets, net: |
|
|
|
|
|
|
|
Broadcast
(1) |
159,739 |
|
150,782 |
|
596,403 |
|
557,563 |
Corporate
and administrative (1) |
10,776 |
|
7,117 |
|
40,910 |
|
31,589 |
Depreciation |
13,296 |
|
13,418 |
|
53,883 |
|
51,973 |
Amortization of
intangible assets |
4,983 |
|
6,388 |
|
20,570 |
|
25,072 |
(Gain) loss on disposal
of assets, net |
(11,218) |
|
939 |
|
(16,405) |
|
(74,200) |
Operating expenses |
177,576 |
|
178,644 |
|
695,361 |
|
591,997 |
Operating income |
150,644 |
|
54,965 |
|
388,771 |
|
290,731 |
Other income
(expense): |
|
|
|
|
|
|
|
Miscellaneous income (expense), net (1) |
3,315 |
|
250 |
|
5,507 |
|
657 |
Interest
expense |
(32,443) |
|
(24,070) |
|
(106,628) |
|
(95,259) |
Loss from
early extinguishment of debt |
- |
|
- |
|
- |
|
(2,851) |
Income before income
tax |
121,516 |
|
31,145 |
|
287,650 |
|
193,278 |
Income tax (benefit)
expense |
33,249 |
|
(134,425) |
|
76,847 |
|
(68,674) |
Net income |
$ |
88,267 |
|
$ |
165,570 |
|
$ |
210,803 |
|
$ |
261,952 |
|
|
|
|
|
|
|
|
Basic per share
information: |
|
|
|
|
|
|
|
Net
income |
$ |
1.01 |
|
$ |
2.15 |
|
$ |
2.39 |
|
$ |
3.59 |
Weighted-average shares outstanding |
87,765 |
|
76,869 |
|
88,084 |
|
73,061 |
|
|
|
|
|
|
|
|
Diluted per share
information: |
|
|
|
|
|
|
|
Net
income |
$ |
1.00 |
|
$ |
2.13 |
|
$ |
2.37 |
|
$ |
3.55 |
Weighted-average shares outstanding |
88,685 |
|
77,826 |
|
88,778 |
|
73,836 |
|
|
|
|
|
|
|
|
Political advertising
revenue |
|
|
|
|
|
|
|
(less
agency commissions) |
$ |
83,211 |
|
$ |
7,464 |
|
$ |
155,074 |
|
$ |
16,498 |
(1) Amounts in 2017 have been reclassified to give effect to the
implementation of ASU 2017-07.
|
|
|
|
Other Financial Data: |
|
|
|
|
December 31, 2018 |
|
December 31, 2017 |
|
(in thousands) |
|
|
|
|
Cash |
$ |
666,980 |
|
$ |
462,399 |
Restricted cash |
$ |
751,963 |
|
$ |
- |
Long-term debt
including current portion |
$ |
2,549,224 |
|
$ |
1,837,428 |
Borrowing availability
under our senior credit facility |
$ |
100,000 |
|
$ |
100,000 |
|
|
|
|
|
Year Ended December 31, |
|
2018 |
|
2017 |
|
(in thousands) |
|
|
|
|
Net cash provided by
operating activities |
$ |
323,316 |
|
$ |
180,015 |
Net cash used in
investing activities |
(47,377) |
|
(349,799) |
Net cash provided by
financing activities |
680,605 |
|
306,994 |
Net increase in cash
and restricted cash |
$ |
956,544 |
|
$ |
137,210 |
Guidance for the Three-Months Ending March 31,
2019:
Based on our current forecasts for the quarter ending March 31,
2019 (the “first quarter of 2019”), we anticipate changes from the
quarter ended March 31, 2018 (the “first quarter of 2018”) as
outlined below.
As Reported
Basis: |
|
Low End |
|
%
Change |
|
High End |
|
%
Change |
|
|
|
|
Guidance for |
|
From |
|
Guidance for |
|
From |
|
As-Reported |
|
|
the First |
|
As-Reported |
|
the First |
|
As-Reported |
|
First |
|
|
Quarter of |
|
First Quarter of |
|
Quarter of |
|
First Quarter of |
|
Quarter of |
Selected operating data: |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
2018 |
|
|
(dollars in thousands) |
OPERATING REVENUE (less
agency |
|
|
|
|
|
|
|
|
|
|
commissions): |
|
|
|
|
|
|
|
|
|
|
Broadcast |
|
$ |
460,000 |
|
103
% |
|
$ |
465,000 |
|
106
% |
|
$ |
226,258 |
Production companies |
|
$ |
35,000 |
|
|
|
$ |
37,000 |
|
|
|
$ |
- |
Total
revenue |
|
$ |
495,000 |
|
119
% |
|
$ |
502,000 |
|
122
% |
|
$ |
226,258 |
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES
(before |
|
|
|
|
|
|
|
|
|
|
depreciation, amortization and (gain) loss |
|
|
|
|
|
|
|
|
|
|
on
disposals of assets): |
|
|
|
|
|
|
|
|
|
|
Broadcast |
|
$ |
355,000 |
|
137
% |
|
$ |
358,000 |
|
139
% |
|
$ |
149,654 |
Production companies |
|
$ |
34,000 |
|
|
|
$ |
36,000 |
|
|
|
$ |
- |
Corporate
and administrative |
|
$ |
45,000 |
|
445
% |
|
$ |
50,000 |
|
505
% |
|
$ |
8,260 |
|
|
|
|
|
|
|
|
|
|
|
OTHER SELECTED
DATA: |
|
|
|
|
|
|
|
|
|
|
Political
advertising revenue (less |
|
|
|
|
|
|
|
|
|
|
agency
commissions) |
|
$ |
750 |
|
(87)% |
|
$ |
1,000 |
|
(83)% |
|
$ |
5,775 |
|
|
|
|
|
|
|
|
|
|
|
Combined
Historical Basis: |
|
Low End |
|
% Change |
|
High End |
|
% Change |
|
|
|
|
Guidance for |
|
From |
|
Guidance for |
|
From |
|
CHB |
|
|
the First |
|
CHB |
|
the First |
|
CHB |
|
First |
|
|
Quarter of |
|
First Quarter of |
|
Quarter of |
|
First Quarter of |
|
Quarter of |
Selected operating data: |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
2018 |
|
|
(dollars in thousands) |
OPERATING REVENUE (less
agency |
|
|
|
|
|
|
|
|
|
|
commissions): |
|
|
|
|
|
|
|
|
|
|
Broadcast |
|
$ |
460,000 |
|
3
% |
|
$ |
465,000 |
|
4
% |
|
$ |
448,619 |
Production companies |
|
$ |
35,000 |
|
(1)% |
|
$ |
37,000 |
|
5
% |
|
$ |
35,363 |
Total
revenue |
|
$ |
495,000 |
|
2
% |
|
$ |
502,000 |
|
4
% |
|
$ |
483,982 |
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES
(before |
|
|
|
|
|
|
|
|
|
|
depreciation, amortization and (gain) loss |
|
|
|
|
|
|
|
|
|
|
on
disposals of assets): |
|
|
|
|
|
|
|
|
|
|
Broadcast |
|
$ |
355,000 |
|
18
% |
|
$ |
358,000 |
|
19
% |
|
$ |
300,014 |
Production companies |
|
$ |
34,000 |
|
2
% |
|
$ |
36,000 |
|
8
% |
|
$ |
33,390 |
Corporate
and administrative |
|
$ |
45,000 |
|
169
% |
|
$ |
50,000 |
|
199
% |
|
$ |
16,738 |
|
|
|
|
|
|
|
|
|
|
|
OTHER SELECTED
DATA: |
|
|
|
|
|
|
|
|
|
|
Political
advertising revenue (less |
|
|
|
|
|
|
|
|
|
|
agency
commissions) |
|
$ |
750 |
|
(92)% |
|
$ |
1,000 |
|
(89)% |
|
$ |
8,858 |
|
|
|
|
|
|
|
|
|
|
|
Broadcast
operating expenses |
|
|
|
|
|
|
|
|
|
|
(excluding transaction related expenses) |
|
$ |
322,000 |
|
7
% |
|
$ |
324,000 |
|
8
% |
|
$ |
300,014 |
Corporate
and administrative operating expenses |
|
|
|
|
|
|
|
|
|
|
(excluding transaction related expenses) |
|
$ |
16,000 |
|
(4)% |
|
$ |
20,000 |
|
19
% |
|
$ |
16,738 |
|
|
|
|
|
|
|
|
|
|
|
Comments on First Quarter 2019
Guidance:
First Quarter of 2019 on As-Reported Basis
Our results of operations in the first quarter of 2019 will be
materially impacted by the Raycom Merger and are generally not
comparable to the first quarter of 2018 on an as-reported basis.
Accordingly, our comments on the expected first quarter of 2019
selected operating data are only presented on a Combined Historical
Basis, as defined herein.
First Quarter of 2019 on Combined Historical
Basis
Based on our current forecasts for the first quarter of 2019, we
anticipate the following changes from the Combined Historical Basis
results for the first quarter of 2018 as outlined below.
Revenue on Combined Historical Basis:
- We believe our first quarter of 2019 total revenue will be
within a range of approximately $495.0 million to $502.0 million
(or increase approximately +2% to +4% from $484.0 million in the
first quarter of 2018).
- We believe our first quarter of 2019 local advertising revenue
(including internet/digital/mobile) will be within a range of
approximately $202.0 million to $205.0 million (or decrease
approximately -5% to -4% from $213.8 million in the first quarter
of 2018).
- We believe our first quarter of 2019 national advertising
revenue will be within a range of approximately $48.0 million to
$49.0 million (or decrease approximately -10% to -8% from $53.1
million in the first quarter of 2018).
- We believe our first quarter of 2019 political advertising
revenue will be within a range of approximately $750,000 to $1.0
million. Our political advertising revenue was approximately $8.9
million in the first quarter of 2018 and approximately $2.1 million
in the first quarter of 2017.
- We believe our first quarter of 2019 retransmission consent
revenue will be within a range of approximately $197.0 million to
$200.0 million (or increase approximately +22% to +23% from $162.1
million in the first quarter of 2018). We currently anticipate full
year 2019 retransmission consent revenue will increase by
approximately 20% compared to the full year of 2018.
Our 2018 local and national revenue included approximately $12.7
million of advertising revenue associated with the broadcast of the
Winter Olympics (including approximately $3.6 million from
automotive advertising customers). There were no Olympic
broadcasts in the first quarter of 2019. Excluding the advertising
revenue from the 2018 Winter Olympics, we believe that our first
quarter of 2019 combined local and national advertising revenue
will be approximately unchanged from the first quarter of 2018.
In the first quarter of 2019 we anticipate approximately $4.7
million of revenue from the broadcast of the Super Bowl in our 44
CBS markets compared to approximately $4.1 million in the first
quarter of 2018 when the Super Bowl was broadcast in our 42 NBC
markets.
Broadcast Operating Expenses (before depreciation,
amortization and gain or loss on disposal of assets) on Combined
Historical Basis
Our total broadcast operating expenses for the first quarter of
2019 are anticipated to increase from the first quarter of 2018 on
a Combined Historical Basis by a range of approximately $55.0
million to $58.0 million (or increase approximately +18% to +19%
from $300.0 million in the first quarter of 2018).
This increase reflects an expected increase in retransmission
expense by a range of approximately $19.0 million to $20.0 million
(or increase approximately +22% to +23% from $85.3 million in the
first quarter of 2018). Compensation expenses will include non-cash
stock-based compensation expenses of approximately $0.1 million in
the first quarter of 2019 compared to $1.2 million for the first
quarter of 2018.
In addition, broadcast expenses in the first quarter of 2019 are
anticipated to include between $33.0 million and $34.0 million of
transaction related expenses associated with the Raycom Merger
including, but not limited to, approximately $27.6 million of
expense associated with termination of Raycom’s national sales
representation agreement and approximately $5.3 million of
severance or other transaction related compensation. Excluding
these transaction related expenses, we expect that our broadcast
operating expenses on a Combined Historical Basis will increase to
within a range of approximately $322.0 million to $324.0 million
compared to $300.0 million for the first quarter of 2018.
Corporate and Administrative Operating Expenses (before
depreciation, amortization and gain or loss on disposal of assets)
on Combined Historical Basis
Our total corporate and administrative operating expenses for
the first quarter of 2019 are anticipated to increase from the
first quarter of 2018 on a Combined Historical Basis by a range of
approximately $28.0 million to $33.0 million (or increase
approximately +169% to +199% from $16.7 million in the first
quarter of 2018). Compensation expenses will include non-cash
stock-based compensation expenses of approximately $2.6
million in the first quarter of 2019 compared to $0.9 million for
the first quarter of 2018.
In addition, corporate and administrative operating expenses in
the first quarter of 2019 are anticipated to include between $29.0
million and $30.0 million of transaction related expenses
associated with the Raycom Merger including, but not limited to,
advisor fees, legal and accounting fees and severance or other
transaction related compensation. Excluding these transaction
related expenses, we expect that our corporate and administrative
operating expenses on a Combined Historical Basis will be within a
range of approximately $16.0 million to $20.0 million compared to
$16.7 million for the first quarter of 2018.
Other comments Related to the Raycom Merger
We have not yet completed the preparation and audit of carve-out
financial statements for Raycom as of and for the year ended
December 31, 2018. However, based on preliminary internal
forecasts for 2018 and after giving effect to the Raycom Merger as
if completed on January 1, 2016 (the first day of the earliest
period presented), we can provide below certain preliminary
unaudited estimates. These estimates as of December 31, 2018
and for the periods indicated incorporate certain non-GAAP
financial measures that are dependent on financial results that are
not yet determinable with certainty. We are unable to present a
quantitative reconciliation of the estimated non-GAAP financial
measures to their most directly comparable GAAP financial measures
because such information is not yet available and management cannot
reliably estimate all of the necessary components of such GAAP
measures without unreasonable effort or expense. In addition,
we believe such reconciliation would imply a degree of precision
that would be confusing or misleading to investors.
- Outstanding Debt - Gray’s aggregate principal
amount of debt outstanding would have been approximately $3.97
billion as of December 31, 2018.
- Cash on Hand - our available cash on hand
would have been approximately $200 million as of December 31,
2018.
- Operating Cash Flow as Defined in our Senior Credit
Facility – we currently estimate that our Operating Cash
Flow as defined under our senior credit facility on a trailing
eight quarter basis for the year ended December 31, 2018 would have
been within a range of $780 million and $795 million. Operating
Cash Flow is as defined under our senior credit facility, and it
includes the previously announced $80 million of anticipated
annualized synergies expected from the Raycom Merger and excludes
associated transaction costs. We have previously estimated that our
Operating Cash Flow as defined in our senior credit facility would
have been:
- $803.0 million for the year ended December 31, 2016
- $685.8 million for the year ended December 31, 2017
- Leverage Ratio - our debt to Operating Cash
Flow leverage ratio, net of all cash on hand, is currently
estimated to have been within a range of approximately 4.75 and
4.85 times as of and for the year ended December 31, 2018. This
ratio is as defined under our senior credit facility. It includes
the previously announced $80 million of anticipated annualized
synergies expected from the Raycom Merger and excludes associated
transaction costs.
- Free Cash Flow – we have previously estimated
that our Free Cash Flow would have been:
- $401.7 million for the year ended December 31, 2016
- $299.4 million for the year ended December 31, 2017
- Based upon the preliminary information we have available
currently, we estimate that Free Cash Flow for the year ended
December 31, 2018 would have been within a range of $500 million
and $525 million.
- Common Stock Outstanding – after giving effect
to the Raycom Merger and related financing, Gray would have had
approximately 6.7 million shares of class A common stock
outstanding and 93.8 million shares common stock outstanding as of
December 31, 2018 for a combined total of approximately 100.5
million shares.
The Company
We are a television broadcast company headquartered in Atlanta,
Georgia, that is one of the largest owners of television stations
in 91 television markets broadcasting almost 400 affiliates
including nearly 150 affiliates of the CBS/NBC/ABC/FOX networks, as
well as other networks and program streams. Our portfolio includes
the number-one or number-two ranked television station for both
overall audience and news audience in 86 markets, which
collectively cover approximately 24% of total United States
television households. In addition, our operations include video
program production, marketing, and digital businesses including
Raycom Sports, Tupelo-Raycom, and RTM Studios, the producer of
PowerNation programs and content. For further information, please
visit www.gray.tv.
Cautionary Statements for Purposes of the
“Safe Harbor” Provisions of the Private Securities Litigation
Reform Act
This press release contains statements that constitute
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995 and the federal securities
laws. These “forward-looking statements” are not statements of
historical facts, and may include, among other things, statements
regarding our current expectations and beliefs of operating results
for the first quarter of 2019 or other periods and other future
events. Actual results are subject to a number of risks and
uncertainties and may differ materially from the current
expectations and beliefs discussed in this press release. All
information set forth in this release is as of the date hereof. We
do not intend, and undertake no duty, to update this information to
reflect future events or circumstances. Information about certain
potential factors that could affect our business and financial
results and cause actual results to differ materially from those
expressed or implied in any forward-looking statements are included
under the captions “Risk Factors” and “Management’s Discussion and
Analysis of Financial Condition and Results of Operations,” in our
Annual Report on Form 10-K for the year ended December 31, 2018 and
may be contained in reports subsequently filed with the U.S.
Securities and Exchange Commission (the “SEC”) and available at the
SEC's website at www.sec.gov.
Conference Call Information
We will host a conference call to discuss our fourth quarter
operating results on February 28, 2019. The call will begin at
11:00 a.m. Eastern Time. The live dial-in number is 1-855-493-3489
and the confirmation code is 5292298. The call will be webcast live
and available for replay at www.gray.tv. The taped replay of the
conference call will be available at 1-855-859-2056, Confirmation
Code: 5292298 until March 28, 2019.
Gray Contacts
Web site: www.gray.tv
Hilton H. Howell, Jr., Executive Chairman and
Chief Executive Officer, 404-266-5512Pat
LaPlatney, President and Co-Chief Executive Officer,
334-206-1400Jim Ryan, Executive Vice President and
Chief Financial Officer, 404-504-9828Kevin P.
Latek, Executive Vice President, Chief Legal and
Development Officer, 404-266-8333
Effects of Acquisitions and Divestitures on Our Results
of Operations and Non-GAAP Terms
From October 31, 2013 through December 31, 2018, we completed 23
acquisition transactions and four divestiture transactions. As more
fully described in our Form 10-K to be filed with the Securities
and Exchange Commission today and in our prior disclosures, these
transactions added television stations in 28 new television
markets, to our operations. We refer to the stations acquired and
the divestiture of WSWG-TV collectively, as the “Acquisitions” or
the “Acquired Stations.” On January 2, 2019, we completed the
Raycom Merger that resulted in the addition of television stations
in 34 new television markets to our operations.
Due to the significant effect that the Acquisitions and the
Raycom Merger have had on our results of operations, and in order
to provide more meaningful period over period comparisons, we
present herein certain financial information on a “Combined
Historical Basis” (or “CHB”). Unless otherwise defined, Combined
Historical Basis reflects financial results that have been compiled
by adding Gray’s historical revenue, broadcast expenses and
corporate and administrative expenses to the historical revenue,
broadcast expenses and corporate and administrative expenses of the
Acquisitions and the net stations acquired in the Raycom Merger and
subtracting the historical revenues and broadcast expenses of
divested stations as if they had been acquired or divested,
respectively, on January 1, 2018, the beginning of the earliest
period that CHB information is presented. Gray is providing these
estimates which incorporate certain non–GAAP financial measures
that are dependent on financial results that are not yet
determinable with certainty. Therefore, we are unable to present a
quantitative reconciliation of the estimated non-GAAP financial
measures to their most directly comparable GAAP financial measures
because such information is not available and management cannot
reliably estimate all of the necessary components of such GAAP
measures without unreasonable effort or expense. In addition, we
believe such reconciliations would imply a degree of precision that
would be confusing or misleading to investors.
Combined Historical Basis financial information does not include
any adjustments for other events attributable to the Acquisitions
and the Raycom Merger. Certain of the Combined Historical Basis
financial information has been derived from, and adjusted based on,
unaudited, unreviewed financial information prepared by other
entities, which Gray cannot independently verify. We cannot assure
you that such financial information would not be materially
different if such information were audited or reviewed and no
assurances can be provided as to the accuracy of such information,
or that our actual results would not differ materially from the
Combined Historical Basis financial information if the Acquisitions
had been completed at the stated date. In addition, the
presentation of Combined Historical Basis, may not comply with
accounting principles generally accepted in the United States of
America (“GAAP”) or the requirements for pro forma financial
information under Regulation S-X under the Securities Act.
From time to time, Gray supplements its financial results
prepared in accordance with GAAP by disclosing the non-GAAP
financial measures Broadcast Cash Flow, Broadcast Cash Flow Less
Cash Corporate Expenses, Free Cash Flow, Operating Cash Flow as
defined in the Senior Credit Agreement and Total Leverage Ratio,
Net of All Cash. These non-GAAP amounts are used by us to
approximate amounts used to calculate key financial performance
covenants contained in our debt agreements and are used with our
GAAP data to evaluate our results and liquidity.
We define Broadcast Cash Flow as net income plus loss from early
extinguishment of debt, corporate and administrative expenses,
non-cash stock based compensation, depreciation and amortization
(including amortization of intangible assets and program broadcast
rights), any loss on disposal of assets, any miscellaneous expense,
interest expense, any income tax expense and non-cash 401(k)
expense, less any gain on disposal of assets, any miscellaneous
income, any income tax benefits and payments for program broadcast
rights.
We define Broadcast Cash Flow Less Cash Corporate Expenses as
net income plus loss from early extinguishment of debt, non-cash
stock based compensation, depreciation and amortization (including
amortization of intangible assets and program broadcast rights),
any loss on disposal of assets, any miscellaneous expense, interest
expense, any income tax expense, and non-cash 401(k) expense, less
any gain on disposal of assets, any miscellaneous income, any
income tax benefits and any payments for program broadcast
rights.
We define Free Cash Flow as net income plus loss from early
extinguishment of debt, non-cash stock based compensation,
depreciation and amortization (including amortization of intangible
assets and program broadcast rights), any loss on disposal of
assets, any miscellaneous expense, amortization of deferred
financing costs, any income tax expense and non-cash 401(k)
expense, less any gain on disposal of assets, any miscellaneous
income, any income tax benefits, payments for program broadcast
rights, contributions to pension plans, amortization of original
issue premium on our debt, purchases of property and equipment (net
of reimbursements) and the payment of income taxes (net of any
refunds received).
We define Operating Cash Flow as defined in our Senior Credit
Agreement as net income plus loss from early extinguishment of
debt, non-cash stock based compensation, depreciation and
amortization (including amortization of intangible assets and
program broadcast rights), any loss on disposal of assets, interest
expense, any income tax expense, non-cash 401(k) expense and trade
expense less any gain on disposal of assets, any income tax
benefits, payments for program broadcast rights, trade income, and
contributions to pension plans. Operating Cash Flow as defined in
our Senior Credit Agreement gives effect to the revenue and
broadcast expenses of the Acquisitions as if they had been acquired
or divested, respectively, on January 1, 2017. It also gives effect
to certain operating synergies expected from the Acquisitions and
related financings and adds back professional fees incurred in
completing the Acquisitions. Certain of the financial information
related to the Acquisitions has been derived from, and adjusted
based on, unaudited, un-reviewed financial information prepared by
other entities, which Gray cannot independently verify. We cannot
assure you that such financial information would not be materially
different if such information were audited or reviewed and no
assurances can be provided as to the accuracy of such information,
or that our actual results would not differ materially from this
financial information if the Acquisitions had been completed at the
stated date. In addition, the presentation of Operating Cash Flow
as defined in the Senior Credit Agreement and the adjustments to
such information, including expected synergies resulting from such
transactions, may not comply with GAAP or the requirements for pro
forma financial information under Regulation S-X under the
Securities Act.
Our Total Leverage Ratio, Net of All Cash is determined by
dividing our Adjusted Total Indebtedness, Net of All Cash by our
Operating Cash Flow as defined in our Senior Credit Agreement,
divided by two. Our Adjusted Total Indebtedness, Net of All Cash
represents the total outstanding principal of our long-term debt,
plus certain other obligations as defined in our Senior Credit
Agreement, less all cash (excluding restricted cash). Our Operating
Cash Flow as defined in our Senior Credit Agreement, divided by
two, represents our average annual Operating Cash Flow as defined
in our Senior Credit Agreement for the preceding eight
quarters.
These non-GAAP terms are not defined in GAAP and our definitions
may differ from, and therefore not be comparable to, similarly
titled measures used by other companies, thereby limiting their
usefulness. Such terms are used by management in addition to, and
in conjunction with, results presented in accordance with GAAP and
should be considered as supplements to, and not as substitutes for,
net income and cash flows reported in accordance with GAAP.
Reconciliation on As-Reported Basis, in
thousands:
|
|
|
|
|
|
|
Three Months Ended |
|
December 31, |
|
2018 |
|
2017 |
|
2016 |
|
|
|
|
|
|
Net income |
$ |
88,267 |
|
$ |
165,570 |
|
$ |
35,834 |
Depreciation |
13,296 |
|
13,418 |
|
11,686 |
Amortization of intangible assets |
4,983 |
|
6,388 |
|
4,231 |
Non-cash
stock based compensation |
1,645 |
|
4,001 |
|
1,274 |
Loss
(gain) on disposal of assets, net |
(11,218) |
|
939 |
|
395 |
Miscellaneous (income) expense, net (1) |
(3,315) |
|
(250) |
|
9 |
Interest
expense |
32,443 |
|
24,070 |
|
23,766 |
Income
tax (benefit) expense |
33,249 |
|
(134,425) |
|
24,309 |
Amortization of program broadcast rights |
5,503 |
|
5,589 |
|
4,975 |
Non-cash
401(k) expense |
4,285 |
|
- |
|
8 |
Payments
for program broadcast rights |
(5,612) |
|
(5,486) |
|
(4,927) |
Corporate
and administrative expenses excluding |
|
|
|
|
|
depreciation, amortization of intangible assets and |
|
|
|
|
|
non-cash
compensation (1) |
9,318 |
|
5,941 |
|
7,942 |
Broadcast Cash
Flow (1) |
172,844 |
|
85,755 |
|
109,502 |
Corporate
and administrative expenses excluding |
|
|
|
|
|
depreciation, amortization of intangible assets and |
|
|
|
|
|
non-cash
compensation (1) |
(9,318) |
|
(5,941) |
|
(7,942) |
Broadcast Cash
Flow Less Cash Corporate Expenses (1) |
163,526 |
|
79,814 |
|
101,560 |
Contributions to pension plans |
- |
|
(2,500) |
|
(10) |
Interest
expense |
(32,443) |
|
(24,070) |
|
(23,766) |
Amortization of deferred financing costs |
1,158 |
|
1,158 |
|
1,220 |
Net
amortization of original issue (premium) discount |
|
|
|
|
|
on senior
notes |
(152) |
|
(152) |
|
(153) |
Purchase
of property and equipment |
(35,081) |
|
(13,090) |
|
(10,366) |
Reimbursements of property and equipment purchases |
7,979 |
|
- |
|
- |
Income
taxes received (paid), net of refunds |
(7,151) |
|
(777) |
|
1 |
Free Cash
Flow |
$ |
97,836 |
|
$ |
40,383 |
|
$ |
68,486 |
(1) Amounts in 2017 have been reclassified to give effect to the
implementation of ASU 2017-07.
Reconciliation on As-Reported Basis, in
thousands:
|
|
|
|
|
|
|
Year Ended |
|
December 31, |
|
2018 |
|
2017 |
|
2016 |
|
|
|
|
|
|
Net income |
$ |
210,803 |
|
$ |
261,952 |
|
$ |
62,273 |
Depreciation |
53,883 |
|
51,973 |
|
45,923 |
Amortization of intangible assets |
20,570 |
|
25,072 |
|
16,596 |
Non-cash
stock based compensation |
6,661 |
|
8,303 |
|
5,101 |
(Gain)
loss on disposal of assets, net |
(16,405) |
|
(74,200) |
|
329 |
Miscellaneous (income) expense, net (1) |
(5,507) |
|
(657) |
|
(610) |
Interest
expense |
106,628 |
|
95,259 |
|
97,236 |
Loss from
early extinguishment of debt |
- |
|
2,851 |
|
31,987 |
Income
tax (benefit) expense |
76,847 |
|
(68,674) |
|
43,418 |
Amortization of program broadcast rights |
21,416 |
|
21,033 |
|
19,001 |
Non-cash
401(k) expense |
4,285 |
|
16 |
|
29 |
Payments
for program broadcast rights |
(21,789) |
|
(21,055) |
|
(18,786) |
Corporate
and administrative expenses excluding |
|
|
|
|
|
depreciation, amortization of intangible assets and |
|
|
|
|
|
non-cash
compensation (1) |
35,967 |
|
27,184 |
|
36,441 |
Broadcast Cash
Flow (1) |
493,359 |
|
329,057 |
|
338,938 |
Corporate
and administrative expenses excluding |
|
|
|
|
|
depreciation, amortization of intangible assets and |
|
|
|
|
|
non-cash
compensation (1) |
(35,967) |
|
(27,184) |
|
(36,441) |
Broadcast Cash
Flow Less Cash Corporate Expenses (1) |
457,392 |
|
301,873 |
|
302,497 |
Contributions to pension plans |
(2,500) |
|
(3,124) |
|
(3,048) |
Interest
expense |
(106,628) |
|
(95,259) |
|
(97,236) |
Amortization of deferred financing costs |
4,630 |
|
4,624 |
|
4,884 |
Net
amortization of original issue (premium) discount |
|
|
|
|
|
on senior
notes |
(610) |
|
(610) |
|
(779) |
Purchase
of property and equipment |
(69,975) |
|
(34,516) |
|
(43,604) |
Reimbursements of property and equipment purchases |
14,217 |
|
- |
|
- |
Income
taxes paid, net of refunds |
(33,972) |
|
(1,984) |
|
(14,588) |
Free Cash
Flow |
$ |
262,554 |
|
$ |
171,004 |
|
$ |
148,126 |
(1) Amounts in 2017 have been reclassified to give effect to the
implementation of ASU 2017-07.
Reconciliation of Total Leverage Ratio, Net of All Cash,
in thousands except for ratio:
|
|
|
|
|
|
|
|
|
|
Eight Quarters Ended |
|
|
|
December 31, 2018 |
|
|
|
|
|
Net income |
|
$ |
472,755 |
|
Adjustments to reconcile from net income to operating cash flow
as |
|
|
|
defined in our Senior Credit Agreement: |
|
|
|
Depreciation |
|
105,856 |
|
Amortization of intangible assets |
|
45,642 |
|
Non-cash
stock-based compensation |
|
14,965 |
|
(Gain)
loss on disposals of assets, net |
|
(90,605) |
|
Interest
expense |
|
201,887 |
|
Loss from
early extinguishment of debt |
|
2,851 |
|
Income
tax expense |
|
8,173 |
|
Amortization of program broadcast rights |
|
42,449 |
|
Non-cash
401(k) expense |
|
4,301 |
|
Payments
for program broadcast rights |
|
(42,844) |
|
Pension
expense |
|
(1,538) |
|
Contributions to pension plans |
|
(5,624) |
|
Adjustments for stations acquired or divested, financings and
expected |
|
|
|
synergies
during the eight quarter period |
|
(1,940) |
|
Professional fees related to acquisitions and divestitures |
|
9,594 |
|
Operating Cash
Flow as defined in our Senior Credit Agreement |
|
$ |
765,922 |
|
Operating Cash
Flow as defined in our Senior Credit Agreement, |
|
|
|
divided by two |
|
$ |
382,961 |
|
|
|
|
|
|
|
December 31, 2018 |
|
Adjusted Total
Indebtedness: |
|
|
|
Total
outstanding principal, including current portion (1) |
|
$ |
1,820,026 |
|
Capital
leases and other debt |
|
648 |
|
Cash
(unrestricted) (1) |
|
(666,980) |
|
Adjusted Total
Indebtedness, Net of All Cash |
|
$ |
1,153,694 |
|
|
|
|
|
Total Leverage
Ratio, Net of All Cash |
|
3.01 |
|
|
|
|
|
(1) Total outstanding principal, including current portion excluded
$750.0 million of our 2027 Notes and Cash (unrestricted) excluded
$752.0 million of restricted cash, each held by our special purpose
wholly-owned subsidiary, that is an unrestricted subsidiary under
the 2017 Senior Credit Facility. |
|
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