Beasley Broadcast Group, Inc. (Nasdaq: BBGI), a large- and mid-size
market radio broadcaster, today announced operating results for the
three- and nine-month periods ended September 30, 2005. For the
three months ended September 30, 2005, consolidated net revenue
rose 1% to $32.1 million from $31.8 million in the same period of
2004. Operating income for the period declined 7% to $7.9 million,
compared to $8.5 million in the third quarter of 2004. Station
Operating Income (SOI), a non-GAAP financial measure, rose 4% to
$11.2 million from $10.8 million in the year-ago period. Operating
income for all periods presented in this announcement includes $0.8
million of stock-based employee compensation as a result of
restricted stock grants during the third quarter of 2005 at both
the station and corporate level. SOI reflects $46,735 of
stock-based employee compensation related to restricted stock
grants during the third quarter of 2005 to employees at our radio
stations, but excludes stock-based employee compensation costs
during that period at the corporate level. Please refer to the
"Calculation of SOI" and "Reconciliation of SOI to Net Income"
tables at the end of this announcement for a break down of
stock-based employee compensation expense between the station and
corporate levels. Net income was $3.8 million, or $0.15 per diluted
share, in the three months ended September 30, 2005, compared to
net income of $4.1 million, or $0.17 per diluted share, in the
three months ended September 30, 2004. Per share results for the
three months ended September 30, 2005 and 2004 are based on
24,291,056 and 24,363,737 diluted shares outstanding, respectively.
For the nine months ended September 30, 2005, consolidated net
revenue increased 6% to $93.7 million from $88.8 million in the
same period of 2004. Operating income from continuing operations
was $20.2 million, compared to $21.3 million in the year-ago
period, while SOI grew 2% to $28.6 million from $28.1 million. The
Company reported net income of $9.2 million, or $0.38 per diluted
share, for the first nine months of 2005, compared to net income of
$8.1 million, or $0.33 per diluted share, in the comparable 2004
period. Net income for the first nine months of 2004 reflects a
$2.4 million loss on extinguishment of long-term debt. Per share
results for the nine months ended September 30, 2005 and 2004 are
based on 24,356,335 and 24,496,979 diluted shares outstanding,
respectively. Reported and same-station results were the same for
the periods presented above, as no station acquisitions or
dispositions were completed in the relevant periods. Commenting on
the results, George G. Beasley, Chairman and Chief Executive
Officer, said, "Third quarter revenue growth reflects improved
performance at our Philadelphia and Fort Myers-Naples station
clusters, partially offset by decreases at our Augusta, Las Vegas
and Miami station clusters. Net revenues for the period also
reflect a decrease in trade sales revenue due to a company-wide
effort to reduce the non-cash use of our station advertising
inventory." "We anticipate that many of the trends that affected
third quarter revenue performance will continue into the fourth
quarter. Early in the fourth quarter of 2005, we reformatted a
station in Las Vegas, which is not airing commercials during its
first month of operation. Revenue in the 2005 fourth quarter will
also reflect decreased revenues at our Miami cluster, where our
sport-talk station did not renew the program rights agreement to
broadcast the Miami Dolphins football games this year, as well as
the absence of $1.1 million in political advertising revenue.
"Despite these short-term operating challenges, we remain
optimistic about our long-term prospects. We believe that many of
the changes we are implementing in 2005 will make the company
stronger and more competitive in 2006, and we are looking forward
to reporting back on progress in the periods ahead." Fourth Quarter
Guidance For the three-month period ending December 31, 2005, the
Company anticipates reporting a net revenue decrease of 12%
compared to the year-ago level. This guidance assumes no material
changes in economic conditions or extraordinary world events. The
Company can give no assurance as to whether these conditions will
continue, or if they change, how such changes may affect the
Company's current expectations. While the Company may, from time to
time, issue updated guidance, it assumes no obligation to do so.
Conference Call Information: The Company will host a conference
call and simultaneous webcast today, November 3, 2005, at 10:00
a.m. EDT to discuss its financial results and operations. Both the
call and webcast are open to the general public. The dial in number
for the conference call is 973/409-9261; please call five minutes
in advance to ensure that you are connected prior to the
presentation. Interested parties may also access the live call on
the Internet at the Company's Web site at www.bbgi.com; allow 15
minutes to register and download and install any necessary
software. Following its completion, a replay of the call can be
accessed for 14 days on the Internet from the Company's Web site or
for 24 hours via telephone at 973/341-3080 (reservation #6573953).
Founded in 1961, Beasley Broadcast Group, Inc. is a radio
broadcasting company that owns or operates 41 stations (26 FM and
15 AM) located in ten large- and mid-size markets in the United
States. Definitions Same-station results compare stations operated
by our company at September 30, 2005 to those same-stations
operated by our company at September 30, 2004. Station Operating
Income (SOI) consists of net revenue less station operating
expenses. We define station operating expenses as costs of services
(excluding depreciation and amortization) and selling, general and
administrative expenses (including stock-based employee
compensation related to restricted stock grants to employees at our
radio stations, but excluding stock-based employee compensation
costs at the corporate level). SOI and same-station SOI are
financial measures of performance that are not calculated in
accordance with U.S. generally accepted accounting principles,
which we refer to as GAAP. We use these non-GAAP financial measures
for internal budgeting purposes and to evaluate the performance of
our radio stations. We also use SOI to make decisions as to the
acquisition and disposition of radio stations. SOI excludes
corporate-level costs and expenses, stock-based employee
compensation related to stock grants to corporate employees, and
depreciation and amortization, which may be material to an
assessment of the Company's overall operating performance.
Management compensates for this limitation by separately
considering the impact of these excluded items to the extent they
are material to operating decisions or assessments of the Company's
operating performance. Moreover, the corresponding amounts of the
non-cash and corporate-level costs and expenses excluded from the
calculation are available to investors as they are presented as
separate line items on our statements of operations contained in
our periodic reports filed with the Securities and Exchange
Commission (SEC). While the Company recognizes that because SOI is
not calculated in accordance with GAAP, it is not necessarily
comparable to similarly titled measures employed by other
companies, SOI is a measure widely used in the radio broadcast
industry. Management believes that SOI provides meaningful
information to investors because it is an important measure of how
effectively we operate our business (i.e., operate radio stations)
and assists investors in comparing our operating performance with
that of other radio companies. We also believe that providing SOI
on a same station basis is a useful measure of our performance
because it presents SOI before the impact of any acquisitions or
dispositions completed during the relevant periods. This allows
management and investors to measure the performance of radio
stations we owned and operated during the entirety of two operating
periods being compared. Note Regarding Forward-Looking Statements:
Statements in this release that are "forward-looking statements"
are based upon current expectations and assumptions, and involve
certain risks and uncertainties within the meaning of the U.S.
Private Securities Litigation Reform Act of 1995. Words or
expressions such as "intends," "expects," "expected," "anticipates"
or variations of such words and similar expressions are intended to
identify such forward-looking statements. Key risks are described
in the Company's reports filed with the SEC. Readers should note
that these statements are subject to change and to inherent risks
and uncertainties and may be impacted by several factors,
including: economic and regulatory changes, the loss of key
personnel, a downturn in the performance of our radio stations, the
Company's substantial debt levels, and changes in the radio
broadcast industry generally. The Company's actual performance and
results could differ materially because of these factors and other
factors discussed in the "Management's Discussion and Analysis of
Results of Operations and Financial Condition" of our SEC filings,
including but not limited to annual reports on Form 10-K or
quarterly reports on Form 10-Q, copies of which can be obtained
from the SEC, www.sec.gov, or our website, www.bbgi.com. These
statements do not include the potential impact of any acquisitions
or dispositions announced or completed after November 3, 2005. All
information in this release is as of November 3, 2005, and the
Company undertakes no obligation to update the information
contained herein to actual results or changes to the Company's
expectations. -0- *T BEASLEY BROADCAST GROUP, INC. Consolidated
Statements of Operations (unaudited) Three Months Ended Nine Months
Ended September 30, September 30, 2005 2004 2005 2004 ------------
------------ ------------ ------------ Net revenue $32,051,349
$31,771,720 $93,699,011 $88,799,482 ------------ ------------
------------ ------------ Costs and expenses: Cost of services
(excluding depreciation and amortization) (1) 9,995,258 9,992,362
30,729,669 28,940,458 Selling, general and administrative
(excluding stock-based employee compensation) (1) 10,853,577
11,029,209 34,323,178 31,793,317 Corporate general and
administrative (excluding stock-based employee compensation)
1,810,095 1,538,538 5,277,128 4,636,491 Stock-based employee
compensation(2) 807,137 - 807,137 - Depreciation and amortization
705,351 725,994 2,171,465 2,133,345 Asset purchase agreement
termination costs - - 141,449 - ------------ ------------
------------ ------------ Total costs and expenses 24,171,418
23,286,103 73,450,026 67,503,611 Operating income 7,879,931
8,485,617 20,248,985 21,295,871 Interest expense (1,779,972)
(1,779,535) (5,564,008) (5,604,167) Loss on extinguishment of
long-term debt(3) - - - (2,418,781) Gain on increase in fair value
of derivative Financial instruments - 23,382 - 175,331 Interest
income 122,217 96,395 376,657 275,779 Other non-operating income
(expense) (413) (2,109) 125,897 (62,179) ------------ ------------
------------ ------------ Income before income taxes 6,221,763
6,823,750 15,187,531 13,661,854 Income tax expense 2,463,818
2,722,479 6,014,262 5,544,481 ------------ ------------
------------ ------------ Net income $3,757,945 $4,101,271
$9,173,269 $8,117,373 ============ ============ ============
============ Basic net income per share: 0.16 0.17 0.38 0.33
Diluted net income per share: 0.15 0.17 0.38 0.33 Basic common
shares outstanding 24,199,515 24,263,608 24,223,549 24,272,107
============ ============ ============ ============ Diluted common
shares outstanding 24,291,056 24,363,737 24,356,335 24,496,979
============ ============ ============ ============ (1) We refer to
our "Cost of services (excluding depreciation and amortization),"
"Selling, general and administrative" and "stock-based employee
compensation related to restricted stock grants to employees at our
radio stations" together as our "station operating expenses" for
the "Calculation of SOI" and "Reconciliation of SOI to Net Income"
below. (2) On July 1, 2005, we granted 267,500 shares of restricted
stock to certain employees under our 2000 Equity Plan and recorded
stock-based employee compensation related to these grants. Of this
amount, $46,735 is attributable to grants at the radio station
level, while $760,402 is attributable to grants at the corporate
level. (3) In the 2004 first quarter, we incurred a loss on
extinguishment of debt of $2.4 million to write-off debt issuance
costs related to the old credit facility and certain fees related
to the establishment of a new credit facility. Selected Balance
Sheet Data - Unaudited (in thousands) ------------- -------------
September 30, December 31, ------------- ------------- 2005 2004
------------- ------------- Cash and cash equivalents $15,753
$14,850 Working capital 27,426 26,580 Total assets 285,783 286,300
Long term debt, less current installments 140,737 153,362 Total
stockholders' equity 88,780 81,075 Selected Statement of Cash Flows
Data - Unaudited (in thousands) ---------------------------- Nine
Months Ended September 30, ---------------------------- 2005 2004
-------------- ------------- Net cash provided by operating
activities $14,049 $16,425 Net cash used in investing activities
(1,199) (3,066) Net cash used in financing activities (11,948)
(10,682) -------------- ------------- Net increase in cash and cash
equivalents $902 $2,677 ============== ============= Calculation of
SOI (Unaudited): -------------------------------
------------------------- ------------------------- Three Months
Ended Nine Months Ended September 30, September 30,
------------------------- ------------------------- 2005 2004 2005
2004 ------------ ------------ ------------ ------------ Net
revenue $32,051,349 $31,771,720 $93,699,011 $88,799,482 Station
operating expenses (20,848,835) (21,021,571) (65,052,847)
(60,733,775) Station stock-based employee compensation (46,735) -
(46,735) - ------------ ------------ ------------ ------------ SOI
$11,155,779 $10,750,149 $28,599,429 $28,065,707 ============
============ ============ ============ Reconciliation of SOI to Net
Income (Unaudited):
------------------------------------------------
-------------------------- ------------------------ Three Months
Ended Nine Months Ended September 30, September 30,
-------------------------- ------------------------ 2005 2004 2005
2004 ------------- ------------ ------------ ----------- SOI
$11,155,779 $10,750,149 $28,599,429 $28,065,707 Corporate general
and administrative (1,810,095) (1,538,538) (5,277,128) (4,636,491)
Corporate stock- based employee compensation (760,402) - (760,402)
- Depreciation and amortization (705,351) (725,994) (2,171,465)
(2,133,345) Asset purchase agreement termination costs - -
(141,449) - Interest expense (1,779,972) (1,779,535) (5,564,008)
(5,604,167) Loss on extinguishment of long-term debt - - -
(2,418,781) Gain on increase in fair value of derivative financial
instruments - 23,382 - 175,331 Interest income 122,217 96,395
376,657 275,779 Other non-operating income (expense) (413) (2,109)
125,897 (62,179) Income tax expense (2,463,818) (2,722,479)
(6,014,262) (5,544,481) ------------ ------------ ------------
------------ Net income $3,757,945 $4,101,271 $9,173,269 $8,117,373
============ ============ ============ ============ *T
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