Cumulus Media Inc. (NASDAQ: CMLS) (the “Company,” "Cumulus Media,"
“we,” “us,” or “our”) today announced operating results for the
three months and year ended December 31, 2023.
Mary G. Berner, President and Chief Executive
Officer of Cumulus Media, said, "While 2023 was a tough year across
the media landscape, we were able to offset some of the effects of
the weak national advertising climate through strong execution in
our key focus areas. Specifically, we grew our digital businesses,
meaningfully reduced fixed costs, and improved our balance sheet.
Looking ahead, though national advertisers are expressing interest
in increasing their radio buys, as of yet, ad demand
remains choppy, reducing our visibility into the rest of 2024.
That said, our industry-leading performance during similarly weak
macro environments gives us significant confidence in our ability
to navigate through this one and rebound strongly when the
advertising market improves.”
2023 Key Highlights:
- Posted total net revenue of $844.5
million, a decline of 11.4% year-over-year, or 10.0% on an
ex-political basis
- Generated digital revenue of $146.4
million, an increase of 2.9% year-over-year – representing 17% of
total revenue
- Increased streaming revenue by 16% driven by audience growth
from NFL streaming
- Grew local digital marketing services 13% driven by the
addition of new products and investment in our digital sales
capabilities
- Recorded net loss of $117.9 million
compared to net income of $16.2 million in 2022 reflecting a 2023
pre-tax non-cash impairment charge of $65.3 million compared to a
pre-tax non-cash impairment of $15.5 million in 2022, both
primarily all reflecting FCC related charges
- Recorded Adjusted EBITDA(1) of
$90.7 million compared to $166.0 million in 2022
- Generated cash to support debt
paydown and share buybacks
- Generated cash flow from operations of $31.7 million and
completed accretive non-core asset sales of $17.8 million
- Retired $43.6 million face value of debt at an average price of
77.4% of par, bringing total debt retired to $130.2 million, or
16.2% of total debt since the beginning of 2022
- Repurchased $7.2 million of shares, bringing shares repurchased
to $39.0 million, or 22.5% percent of shares outstanding since the
beginning of 2022
- Reported total debt of $675.8
million at December 31, 2023, and net debt(1) of $595.1
million
- Received $14.8 million in cash
proceeds from the closing of the previously announced sale of
Broadcast Music, Inc.
Debt Exchange Offering
The Company is separately announcing an exchange
offer for Cumulus Media New Holdings Inc.'s (the “Issuer”)
outstanding 6.750% Senior Secured First-Lien Notes due 2026 for new
8.750% Senior Secured First-Lien Notes due 2029 (“New Notes”) to be
issued by the Issuer. Concurrently, the Issuer is also offering
lenders under the Issuer’s senior secured term loans (the “Old Term
Loans”) borrowed under its credit agreement, dated as of September
26, 2019, the opportunity to exchange their Old Term Loans for new
senior secured term loans (the “New Term Loans”) issued under a new
credit agreement.
Operating Summary (dollars in thousands, except
percentages and per share data):
For the three months
ended December 31, 2023, the Company reported net revenue
of $221.3 million, a decrease of 11.9% from
the three months ended December 31, 2022, net loss
of $98.1 million and Adjusted EBITDA
of $22.8 million.
For the year ended December 31,
2023, the Company reported net revenue of $844.5 million,
a decrease of 11.4% from the year
ended December 31, 2022, net loss of $117.9
million and Adjusted EBITDA of $90.7 million.
|
As Reported |
Three Months EndedDecember 31, 2023 |
|
Three Months EndedDecember 31, 2022 |
|
% Change |
|
Net revenue |
$ |
221,301 |
|
|
$ |
251,270 |
|
|
(11.9 |
)% |
| Net loss |
$ |
(98,066 |
) |
|
$ |
(54 |
) |
|
181,503.7 |
% |
| Adjusted EBITDA |
$ |
22,798 |
|
|
$ |
42,717 |
|
|
(46.6 |
)% |
| Basic loss per share |
$ |
(5.94 |
) |
|
$ |
(0.00 |
) |
|
N/A |
| Diluted loss per share |
$ |
(5.94 |
) |
|
$ |
(0.00 |
) |
|
N/A |
|
As Reported |
Year EndedDecember 31, 2023 |
|
Year EndedDecember 31, 2022 |
|
% Change |
|
|
Net revenue |
$ |
844,548 |
|
|
$ |
953,506 |
|
|
(11.4 |
)% |
| Net (loss) income |
$ |
(117,879 |
) |
|
$ |
16,235 |
|
|
N/A |
| Adjusted EBITDA |
$ |
90,728 |
|
|
$ |
165,982 |
|
|
(45.3 |
)% |
| Basic (loss) income per
share |
$ |
(6.83 |
) |
|
$ |
0.83 |
|
|
N/A |
| Diluted (loss) income per
share |
$ |
(6.83 |
) |
|
$ |
0.81 |
|
|
N/A |
Revenue Detail Summary (dollars in
thousands):
|
As Reported |
Three Months EndedDecember 31, 2023 |
|
Three Months EndedDecember 31, 2022 |
|
% Change |
| Broadcast radio revenue: |
|
|
|
|
|
|
Spot |
$ |
101,379 |
|
|
$ |
124,099 |
|
|
(18.3 |
)% |
|
Network |
|
52,148 |
|
|
|
63,525 |
|
|
(17.9 |
)% |
| Total broadcast radio
revenue |
|
153,527 |
|
|
|
187,624 |
|
|
(18.2 |
)% |
| Digital |
|
39,583 |
|
|
|
37,708 |
|
|
5.0 |
% |
| Other |
|
28,191 |
|
|
|
25,938 |
|
|
8.7 |
% |
| Net revenue |
$ |
221,301 |
|
|
$ |
251,270 |
|
|
(11.9 |
)% |
|
As Reported |
Year EndedDecember 31, 2023 |
|
Year EndedDecember 31, 2022 |
|
% Change |
| Broadcast radio revenue: |
|
|
|
|
|
|
Spot |
$ |
412,047 |
|
|
$ |
479,834 |
|
|
(14.1 |
)% |
|
Network |
|
182,503 |
|
|
|
229,772 |
|
|
(20.6 |
)% |
| Total broadcast radio
revenue |
|
594,550 |
|
|
|
709,606 |
|
|
(16.2 |
)% |
| Digital |
|
146,425 |
|
|
|
142,312 |
|
|
2.9 |
% |
| Other |
|
103,573 |
|
|
|
101,588 |
|
|
2.0 |
% |
| Net revenue |
$ |
844,548 |
|
|
$ |
953,506 |
|
|
(11.4 |
)% |
Balance Sheet Summary (dollars in
thousands):
|
|
|
December 31, 2023 |
|
December 31, 2022 |
|
Cash and cash equivalents |
|
$ |
80,660 |
|
|
$ |
107,433 |
|
| Term loan due 2026 (2) |
|
$ |
329,510 |
|
|
$ |
338,452 |
|
| 6.75% Senior notes (2) |
|
$ |
346,245 |
|
|
$ |
380,927 |
|
| |
Year EndedDecember 31, 2023 |
|
Year EndedDecember 31, 2022 |
|
Capital expenditures |
$ |
24,814 |
|
|
$ |
31,062 |
|
| |
Three Months EndedDecember 31, 2023 |
|
Three Months EndedDecember 31, 2022 |
|
Capital expenditures |
$ |
3,788 |
|
|
$ |
12,502 |
|
(1) Adjusted EBITDA and net
debt are not financial measures calculated or presented in
accordance with accounting principles generally accepted in the
United States of America (“GAAP”). For additional information, see
“Non-GAAP Financial Measures.”
(2) Excludes unamortized debt
issuance costs.
Earnings Conference Call Details
The Company will host a conference call today at
8:30 AM EST to discuss its fourth quarter and full year 2023
operating results. NetRoadshow (NRS) is the service provider for
this call. They will require email address verification (one-time
only) and will provide registration confirmation. To participate in
the conference call, please register in advance using the link on
the Company's investor relations website at
www.cumulusmedia.com/investors. Upon completing registration, a
calendar invitation will follow with call access details, including
a unique PIN, and replay details.
To join by phone with operator-assisted dial-in,
domestic callers should dial 833-470-1428 and international callers
should dial 404-975-4839. If prompted, the participant access code
is 214014. Please call five to ten minutes in advance to ensure
that you are connected prior to the call.
The conference call will also be broadcast live
in listen-only mode through a link on the Company’s investor
relations website at www.cumulusmedia.com/investors. This link can
also be used to access a recording of the call, which will be
available shortly following its completion.
Please see an update to the Company’s investor
presentation on the Company's investor relations website at
www.cumulusmedia.com/investors, which may be referenced on the
conference call. Unless otherwise specified, information contained
in the investor presentation or on our website is not incorporated
into this press release or other documents we file with, or furnish
to, the SEC.
Forward-Looking
StatementsCertain statements in this release may
constitute “forward-looking” statements within the meaning of the
Private Securities Litigation Reform Act of 1995 and other federal
securities laws. Such statements are statements other than
historical fact and relate to our intent, belief or current
expectations primarily with respect to our future operating,
financial, and strategic performance and our plans and objectives,
including with regard to returning capital to shareholders. Any
such forward-looking statements are not guarantees of future
performance and involve risks, uncertainties and other factors that
may cause actual results, performance or achievements to differ
from those contained in or implied by the forward-looking
statements as a result of various factors. Such factors include,
among others, risks and uncertainties related to the implementation
of our strategic operating plans, the continued uncertain financial
and economic conditions, our ability to complete the exchange
offers, the amount and frequency of our shareholder capital
returns, the rapidly changing and competitive media industry, and
the economy in general. We are subject to additional risks and
uncertainties described in our quarterly and annual reports filed
with the Securities and Exchange Commission from time to time,
including in the "Risk Factors," and "Management’s Discussion and
Analysis of Financial Condition and Results of Operations" sections
contained therein. You should not rely on forward-looking
statements since they involve known and unknown risks,
uncertainties and other factors that are, in some cases, beyond the
Company’s control, and the unexpected occurrence or failure to
occur of any such events or matters could cause our actual results,
performance, financial condition or achievements to differ
materially from those expressed or implied by such forward-looking
statements. Cumulus Media assumes no responsibility to update any
forward-looking statements, which are based upon expectations as of
the date hereof, as a result of new information, future events or
otherwise.
Not an Offer of any
SecurityThis release is for information purposes only and
is not an offer to sell, or a solicitation of an offer to buy or
sell, any security, and may not be relied upon in connection with
the purchase or sale of any such security.
About Cumulus MediaCumulus
Media (NASDAQ: CMLS) is an audio-first media company delivering
premium content to over a quarter billion people every month —
wherever and whenever they want it. Cumulus Media engages listeners
with high-quality local programming through 403 owned-and-operated
radio stations across 85 markets; delivers nationally-syndicated
sports, news, talk, and entertainment programming from iconic
brands including the NFL, the NCAA, the Masters, CNN, AP News, the
Academy of Country Music Awards, and many other world-class
partners across more than 9,800 affiliated stations through
Westwood One, the largest audio network in America; and inspires
listeners through the Cumulus Podcast Network, its rapidly growing
network of original podcasts that are smart, entertaining and
thought-provoking. Cumulus Media provides advertisers with personal
connections, local impact and national reach through broadcast and
on-demand digital, mobile, social, and voice-activated platforms,
as well as integrated digital marketing services, powerful
influencers, full-service audio solutions, industry-leading
research and insights, and live event experiences. Cumulus Media is
the only audio media company to provide marketers with local and
national advertising performance guarantees. For more information
visit www.cumulusmedia.com.
Non-GAAP Financial MeasuresFrom
time to time, we utilize certain financial measures that are not
prepared or calculated in accordance with GAAP to assess our
financial performance and profitability. Consolidated adjusted
earnings before interest, taxes, depreciation, and amortization
("Adjusted EBITDA" or "EBITDA") is the financial metric by which
management and the chief operating decision maker allocate
resources of the Company and analyze the performance of the Company
as a whole. Management also uses this measure to determine the
contribution of our core operations to the funding of our corporate
resources utilized to manage our operations and the funding of our
non-operating expenses including debt service and acquisitions. In
addition, consolidated Adjusted EBITDA is a key metric for purposes
of calculating and determining our compliance with certain
covenants contained in our Refinanced Credit Agreement.
In determining Adjusted EBITDA, we exclude the
following from net (loss) income: interest, taxes, depreciation,
amortization, stock-based compensation expense, gain or loss on the
exchange, sale, or disposal of any assets or stations or early
extinguishment of debt, restructuring costs, expenses relating to
acquisitions and divestitures, non-routine legal expenses incurred
in connection with certain litigation matters, and non-cash
impairments of assets, if any.
Management believes that Adjusted EBITDA, with
and excluding impact of political advertising, although not a
measure that is calculated in accordance with GAAP, is commonly
employed by the investment community as a measure for determining
the market value of a media company and for comparing the
operational and financial performance among media companies.
Management has also observed that Adjusted EBITDA, with and
excluding impact of political advertising, is routinely utilized to
evaluate and negotiate the potential purchase price for media
companies. Given the relevance to our overall value, management
believes that investors consider these metrics to be extremely
useful.
The Company presents revenue, excluding impact
of political revenue. As a result of the cyclical nature of the
electoral system and the seasonality of the related political
revenue, management believes presenting net revenue, excluding
impact of political revenue, provides useful information to
investors about the Company’s revenue growth comparable from period
to period.
The Company presents the non-GAAP financial
measure net debt which is total debt principal, gross, less cash
and cash equivalents. Management believes that net debt is an
important measure to monitor leverage and evaluate the balance
sheet.
We refer to Adjusted EBITDA, with and excluding
the impact of political advertising, net revenue, excluding impact
of political revenue, and net debt as the "Non-GAAP Financial
Measures." Non-GAAP Financial Measures should not be considered in
isolation or as a substitute for net income, net revenue, operating
income, cash flows from operating activities or any other measure
for determining the Company’s operating performance or liquidity
that is calculated in accordance with GAAP. In addition, Non-GAAP
Financial Measures may be defined or calculated differently by
other companies and, therefore, comparability may be limited.
For further information, please
contact:Cumulus Media Inc.Investor
Relations DepartmentIR@cumulus.com404-260-6600
Supplemental Financial Data and
Reconciliations
|
Cumulus Media Inc.Unaudited Condensed
Consolidated Statements of Operations(Dollars in
thousands) |
| |
| |
|
Three Months Ended |
|
Year Ended |
| |
|
December 31,2023 |
|
December 31,2022 |
|
December 31,2023 |
|
December 31,2022 |
|
Net revenue |
|
$ |
221,301 |
|
|
$ |
251,270 |
|
|
$ |
844,548 |
|
|
$ |
953,506 |
|
| Operating expenses: |
|
|
|
|
|
|
|
|
|
Content costs |
|
|
92,420 |
|
|
|
99,685 |
|
|
|
331,359 |
|
|
|
357,478 |
|
|
Selling, general & administrative expenses |
|
|
96,496 |
|
|
|
98,048 |
|
|
|
377,032 |
|
|
|
383,375 |
|
|
Depreciation and amortization |
|
|
14,396 |
|
|
|
14,983 |
|
|
|
58,176 |
|
|
|
56,386 |
|
|
Corporate expenses |
|
|
10,317 |
|
|
|
11,073 |
|
|
|
47,057 |
|
|
|
48,024 |
|
|
Stock-based compensation expense |
|
|
1,181 |
|
|
|
1,517 |
|
|
|
5,270 |
|
|
|
6,229 |
|
|
Restructuring costs |
|
|
4,465 |
|
|
|
1,399 |
|
|
|
17,684 |
|
|
|
8,218 |
|
|
Gain on sale of assets or stations |
|
|
(169 |
) |
|
|
(452 |
) |
|
|
(16,064 |
) |
|
|
(1,537 |
) |
|
Impairment of intangible assets |
|
|
65,312 |
|
|
|
15,544 |
|
|
|
65,312 |
|
|
|
15,544 |
|
|
Total operating expenses |
|
|
284,418 |
|
|
|
241,797 |
|
|
|
885,826 |
|
|
|
873,717 |
|
|
Operating (loss) income |
|
|
(63,117 |
) |
|
|
9,473 |
|
|
|
(41,278 |
) |
|
|
79,789 |
|
| Non-operating expense: |
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(17,801 |
) |
|
|
(17,402 |
) |
|
|
(71,269 |
) |
|
|
(64,890 |
) |
|
Interest income |
|
|
644 |
|
|
|
337 |
|
|
|
2,359 |
|
|
|
340 |
|
|
Gain on early extinguishment of debt |
|
|
— |
|
|
|
2,620 |
|
|
|
9,849 |
|
|
|
4,496 |
|
|
Other expense, net |
|
|
(45 |
) |
|
|
(43 |
) |
|
|
(357 |
) |
|
|
(130 |
) |
|
Total non-operating expense, net |
|
|
(17,202 |
) |
|
|
(14,488 |
) |
|
|
(59,418 |
) |
|
|
(60,184 |
) |
|
(Loss) income before income taxes |
|
|
(80,319 |
) |
|
|
(5,015 |
) |
|
|
(100,696 |
) |
|
|
19,605 |
|
| Income tax (expense)
benefit |
|
|
(17,747 |
) |
|
|
4,961 |
|
|
|
(17,183 |
) |
|
|
(3,370 |
) |
|
Net (loss) income |
|
$ |
(98,066 |
) |
|
$ |
(54 |
) |
|
$ |
(117,879 |
) |
|
$ |
16,235 |
|
The following tables reconcile net (loss) income, the most
directly comparable financial measure calculated and presented in
accordance with GAAP, to Adjusted EBITDA for the periods presented
herein (dollars in
thousands):
| |
|
|
|
|
As Reported |
|
Three Months EndedDecember 31, 2023 |
|
Three Months EndedDecember 31, 2022 |
|
GAAP net loss |
|
$ |
(98,066 |
) |
|
$ |
(54 |
) |
|
Income tax expense (benefit) |
|
|
17,747 |
|
|
|
(4,961 |
) |
|
Non-operating expense, including net interest expense |
|
|
17,202 |
|
|
|
17,108 |
|
|
Depreciation and amortization |
|
|
14,396 |
|
|
|
14,983 |
|
|
Stock-based compensation expense |
|
|
1,181 |
|
|
|
1,517 |
|
|
Gain on sale or disposal of assets or stations |
|
|
(169 |
) |
|
|
(452 |
) |
|
Impairment of intangible assets |
|
|
65,312 |
|
|
|
15,544 |
|
|
Restructuring costs |
|
|
4,465 |
|
|
|
1,399 |
|
|
Non-routine legal expenses |
|
|
600 |
|
|
|
21 |
|
|
Gain on early extinguishment of debt |
|
|
— |
|
|
|
(2,620 |
) |
|
Franchise taxes |
|
|
130 |
|
|
|
232 |
|
| Adjusted EBITDA |
|
$ |
22,798 |
|
|
$ |
42,717 |
|
|
As Reported |
|
Year EndedDecember 31, 2023 |
|
Year EndedDecember 31, 2022 |
|
GAAP net (loss) income |
|
$ |
(117,879 |
) |
|
$ |
16,235 |
|
|
Income tax expense |
|
|
17,183 |
|
|
|
3,370 |
|
|
Non-operating expense, including net interest expense |
|
|
69,267 |
|
|
|
64,680 |
|
|
Depreciation and amortization |
|
|
58,176 |
|
|
|
56,386 |
|
|
Stock-based compensation expense |
|
|
5,270 |
|
|
|
6,229 |
|
|
Gain on sale or disposal of assets or stations |
|
|
(16,064 |
) |
|
|
(1,537 |
) |
|
Impairment of intangible assets |
|
|
65,312 |
|
|
|
15,544 |
|
|
Restructuring costs |
|
|
17,684 |
|
|
|
8,218 |
|
|
Non-routine legal expenses |
|
|
898 |
|
|
|
544 |
|
|
Gain on early extinguishment of debt |
|
|
(9,849 |
) |
|
|
(4,496 |
) |
|
Franchise taxes |
|
|
730 |
|
|
|
809 |
|
| Adjusted EBITDA |
|
$ |
90,728 |
|
|
$ |
165,982 |
|
The following tables reconcile the as reported net revenue and
as reported Adjusted EBITDA, both including and excluding the
impact of political, for the periods presented herein (dollars in
thousands):
| |
|
Three Months EndedDecember 31, 2023 |
|
Three Months EndedDecember 31, 2022 |
|
As reported net revenue |
|
$ |
221,301 |
|
|
$ |
251,270 |
|
|
Political revenue |
|
|
(1,566 |
) |
|
|
(8,298 |
) |
| As reported net revenue,
excluding impact of political revenue |
|
$ |
219,735 |
|
|
$ |
242,972 |
|
| |
|
Three Months EndedDecember 31, 2023 |
|
Three Months EndedDecember 31, 2022 |
|
As reported Adjusted EBITDA |
|
$ |
22,798 |
|
|
$ |
42,717 |
|
|
Political EBITDA |
|
|
(1,409 |
) |
|
|
(7,469 |
) |
| As reported Adjusted EBITDA,
excluding impact of political EBITDA |
|
$ |
21,389 |
|
|
$ |
35,248 |
|
| |
|
Year EndedDecember 31, 2023 |
|
Year EndedDecember 31, 2022 |
|
As reported net revenue |
|
$ |
844,548 |
|
|
$ |
953,506 |
|
|
Political revenue |
|
|
(3,299 |
) |
|
|
(18,425 |
) |
| As reported net revenue,
excluding impact of political revenue |
|
$ |
841,249 |
|
|
$ |
935,081 |
|
| |
|
Year EndedDecember 31, 2023 |
|
Year EndedDecember 31, 2022 |
|
As reported Adjusted EBITDA |
|
$ |
90,728 |
|
|
$ |
165,982 |
|
|
Political EBITDA |
|
|
(2,969 |
) |
|
|
(16,583 |
) |
| As reported Adjusted EBITDA,
excluding impact of political EBITDA |
|
$ |
87,759 |
|
|
$ |
149,399 |
|
The following table reconciles total debt principal, gross, the
most directly comparable financial measure calculated and presented
in accordance with GAAP, to net debt (dollars in thousands):
| |
|
As of December 31, |
|
|
|
|
2023 |
|
|
|
2022 |
|
| Total debt principal,
gross |
|
$ |
675,755 |
|
|
$ |
719,379 |
|
| Less: Cash and cash
equivalents |
|
|
(80,660 |
) |
|
|
(107,433 |
) |
| Total debt principal, net |
|
$ |
595,095 |
|
|
$ |
611,946 |
|
Cumulus Media (NASDAQ:CMLS)
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Cumulus Media (NASDAQ:CMLS)
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