Beasley Broadcast Group, Inc. (Nasdaq: BBGI), a large- and mid-size
market radio broadcaster, today announced operating results for the
three- and twelve-month periods ended December 31, 2005. For the
three months ended December 31, 2005, consolidated net revenue
declined 8.4% to $30.6 million from $33.4 million in the same
period of 2004. During the 2004 fourth quarter, the Company
recorded approximately $1.6 million of revenue related to its
rights to broadcast Miami Dolphins football games, which the
Company did not have during the 2005 period, and $1.1 million of
revenue related to political advertising that did not occur in the
2005 fourth quarter. Net revenue during the quarter ended December
31, 2005 also reflects a decline in revenue due to a format change
in Las Vegas and a reduction in trade sales at our radio stations.
Operating income for the period was $4.8 million, compared to $8.6
million in the fourth quarter of 2004. The 2005 fourth quarter
operating income reflects a $2.0 million impairment charge related
to the FCC licenses in our Augusta market cluster as a result of
the annual impairment test of our FCC licenses, as well as $0.3
million of stock-based compensation expense. Station Operating
Income (SOI), a non-GAAP financial measure, declined 12.9% to $9.6
million from $11.0 million in the year-ago period. 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 compensation expense between the station and corporate
levels. Net income was $1.5 million, or $0.06 per diluted share, in
the three months ended December 31, 2005, compared to net income of
$3.9 million, or $0.16 per diluted share, in the three months ended
December 31, 2004. The 2005 fourth quarter net income reflects the
impact of the impairment charge and stock-based compensation
expense. Per-share results for the three months ended December 31,
2005 and 2004 are based on 24,244,454 and 24,622,866 diluted shares
outstanding, respectively. For the twelve months ended December 31,
2005, consolidated net revenue increased 1.7% to $124.3 million
from $122.2 million in the same period of 2004. Operating income
was $25.1 million, compared to $29.9 million in the year-ago
period, while SOI declined 2.3% to $38.2 million from $39.1
million. The Company reported net income of $10.7 million, or $0.44
per diluted share, for the twelve months ended December 31, 2005,
compared to net income of $12.0 million, or $0.49 per diluted
share, in the comparable 2004 period. Net income for 2005 reflects
the impact of the fourth quarter impairment charge and stock-based
compensation expense while the 2004 period reflected a $2.4 million
loss on extinguishment of long-term debt. Per-share results for the
twelve months ended December 31, 2005 and 2004 are based on
24,325,976 and 24,528,971 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,
"Fourth quarter 2005 revenue levels reflect anticipated declines in
our Augusta, Fayetteville, Las Vegas and Miami station clusters,
primarily due to the launch of a new country station in Las Vegas
and the absence of revenue from broadcasting the Miami Dolphins
football games on our Miami sports talk station. Net revenue in the
2005 fourth quarter also reflects a significant reduction in
political advertising revenue that benefited the comparable 2004
results and a decrease in trade sales revenue. "Beasley's
Philadelphia and Ft. Myers clusters continued to generate
year-over-year double digit revenue increases in the fourth quarter
of 2005. During the fourth quarter and early in 2006, we made
programming and management changes in the important Las Vegas and
Miami markets and, based on the continued gains being achieved in
Philadelphia where similar changes have been implemented, we are
optimistic that both of these markets will deliver greater
contributions to our operating results in future periods. "We
continue to move forward aggressively on the conversion of our
stations to enable HD Radio broadcasts and, as of today, we have
upgraded over 40% of our stations with this impressive new
technology. We are delighted to be a member of The HD Digital Radio
Alliance, a joint initiative of leading radio broadcasters that is
accelerating the rollout of HD digital radio, and believe the
Alliance has already made progress in elevating awareness among
consumers of the many benefits of free HD Radio such as improved
audio quality, better signal reception, song and artist
information, and the ability to choose between multiple programming
options on the same FM frequency. "Consistent with our efforts to
support shareholder value, during the fourth quarter, the Board of
Directors authorized the initiation of a regular quarterly cash
dividend of $0.0625 per share for the Company's Class A and Class B
common stock and we paid the first dividend last month. In
addition, during the 2005 fourth quarter we repurchased 62,500
shares of our common stock pursuant to prior authorization and in
total, we repurchased approximately 131,911 shares in 2005." First
Quarter 2006 Guidance For the three-month period ending March 31,
2006, the Company anticipates reporting a net revenue decrease of
7% compared to the year-ago level. This guidance assumes no
material changes in economic conditions or extraordinary 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, February 13, 2006, at 11:00
a.m. EST 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 #6978062).
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 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 compensation related to restricted stock
grants to employees at our radio stations, but excluding
stock-based 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. 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 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
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 our 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, our substantial debt levels, and changes in
the radio broadcast industry generally. Our 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 February 13, 2006. All
information in this release is as of February 13, 2006, and we
undertake no obligation to update the information contained herein
to actual results or changes to our expectations. -0- *T BEASLEY
BROADCAST GROUP, INC. Consolidated Statements of Operations
(Unaudited) Three Months Ended Twelve months Ended December 31,
December 31, 2005 2004 2005 2004 ------------ ------------
------------- ------------- Net revenue $30,594,921 $33,405,472
$124,293,932 $122,204,954 ------------ ------------ -------------
------------- Costs and expenses: Cost of services (excluding
depreciation and amortization) (1) 10,365,382 11,442,150 41,095,051
40,382,608 Selling, general and administrative (excluding
stock-based compensation) (1) 10,645,881 10,942,384 44,969,059
42,735,701 Corporate general and administrative (excluding
stock-based compensation) 1,716,252 1,747,556 6,993,380 6,384,047
Stock-based compensation(2) 289,475 - 1,096,612 - Depreciation and
amortization 725,594 704,928 2,897,059 2,838,273 Impairment loss(3)
2,002,968 - 2,002,968 - Asset purchase agreement termination costs
- - 141,449 - ------------ ------------ ------------- -------------
Total costs and expenses 25,745,552 24,837,018 99,195,578
92,340,629 Operating income 4,849,369 8,568,454 25,098,354
29,864,325 ------------ ------------ ------------- -------------
Interest expense (1,806,198) (1,843,672) (7,370,206) (7,447,839)
Loss on extinguishment of long-term debt(4) - - - (2,418,781) Other
non- operating expense (2,080) (157,585) (87,450) (220,731) Gain on
increase in fair value of derivative financial instruments - 3,854
- 179,185 Interest income 122,251 108,243 498,908 384,022 Other
non- operating income 3,700 52,475 214,967 53,442 ------------
------------ ------------- ------------- Income before income taxes
3,167,042 6,731,769 18,354,573 20,393,623 Income tax expense
1,634,982 2,818,300 7,649,244 8,362,781 ------------ ------------
------------- ------------- Net income $ 1,532,060 $ 3,913,469 $
10,705,329 $ 12,030,842 ============ ============ =============
============= Basic net income per share: 0.06 0.16 0.44 0.50
Diluted net income per share: 0.06 0.16 0.44 0.49 Basic common
shares outstanding 24,136,781 24,236,287 24,201,679 24,263,103
============ ============ ============= ============= Diluted
common shares outstanding 24,244,454 24,622,866 24,325,976
24,528,971 ============ ============ ============= =============
(1) We refer to our "Cost of services (excluding depreciation and
amortization)," "Selling, general and administrative" and
"stock-based 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 under our 2000 Equity Plan and recorded
stock-based compensation related to these grants. Of this amount,
$36,027 is attributable to grants at the radio station level, while
$1,060,585 is attributable to grants at the corporate level for the
twelve months ended December 31, 2005. (3) As of December 31, 2005,
we tested our FCC broadcasting licenses for impairment. As a result
of the testing, we recorded an impairment loss of $2.0 million
related to the FCC broadcasting license in our Augusta market
cluster. (4) 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) ------------ ------------
December 31, December 31, ------------ ------------ 2005 2004
------------ ------------ Cash and cash equivalents $ 16,279 $
14,850 Working capital 32,571 26,580 Total assets 280,817 286,300
Long term debt, less current installments 144,375 153,362 Total
stockholders' equity 87,998 81,075 Selected Statement of Cash Flows
Data - Unaudited (in thousands) Twelve Months Ended December 31,
-------------------------- 2005 2004 ------------- ------------ Net
cash provided by operating activities $ 20,467 $ 24,736 Net cash
used in investing activities (2,400) (3,708) Net cash used in
financing activities (16,638) (13,907) ------------- ------------
Net increase in cash and cash equivalents $ 1,429 $ 7,121
============= ============ Calculation of SOI (Unaudited):
--------------------------------- ---------------------------
--------------------------- Three Months Ended Twelve Months Ended
December 31, December 31, ---------------------------
--------------------------- 2005 2004 2005 2004 -------------
------------- ------------- ------------- Net revenue $ 30,594,921
$ 33,405,472 $124,293,932 $122,204,954 Station operating expenses
(21,011,263) (22,384,534) (86,064,110) (83,118,309) Station stock-
based compensation 10,708 - (36,027) - ------------- -------------
------------- ------------- SOI $ 9,594,366 $ 11,020,938 $
38,193,795 $ 39,086,645 ============= ============= =============
============= Reconciliation of SOI to Net Income (Unaudited):
--------------------------------------------------
------------------------- ------------------------- Three Months
Ended Twelve Months Ended December 31, December 31,
------------------------- ------------------------- 2005 2004 2005
2004 ------------ ------------ ------------ ------------ SOI $
9,594,366 $11,020,938 $38,193,795 $39,086,645 Corporate general and
administrative (1,716,252) (1,747,556) (6,993,380) (6,384,047)
Corporate stock- based compensation (300,183) - (1,060,585) -
Depreciation and amortization (725,594) (704,928) (2,897,059)
(2,838,273) Impairment loss (2,002,968) - (2,002,968) - Asset
purchase agreement termination costs - - (141,449) - Interest
expense (1,806,198) (1,843,672) (7,370,206) (7,447,839) Loss on
extinguishment of long-term debt - - - (2,418,781) Gain on increase
in fair value of derivative financial instruments - 3,854 - 179,185
Interest income 122,251 108,243 498,908 384,022 Other non-operating
income (expense) 1,620 (105,110) 127,517 (167,289) Income tax
expense (1,634,982) (2,818,300) (7,649,244) (8,362,781)
------------ ------------ ------------ ------------ Net income $
1,532,060 $ 3,913,469 $10,705,329 $12,030,842 ============
============ ============ ============ *T
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