|
Webcast: |
Today, January 30, 2014 at 10:00
a.m. ET |
www.bbgi.com |
Replay
information provided below |
Beasley Broadcast Group, Inc. (Nasdaq:BBGI), a large- and mid-size
market radio broadcaster, today announced operating results for the
three-month and twelve month periods ended December 31, 2013 as
summarized below.
Summary of Fourth
Quarter and 2013 Full Year Results |
In millions, except per share data |
Three Months
Ended December 31, |
|
Twelve
Months Ended December 31, |
|
|
2013 |
2012 |
Change |
2013 |
2012 |
Change |
Net revenue |
$27.3 |
$27.4 |
(0.5)% |
$104.9 |
$100.2 |
4.7% |
Station operating income (SOI)
(non-GAAP) (1) |
10.2 |
10.8 |
(5.2)% |
37.9 |
37.7 |
0.4% |
Operating income (1) |
7.4 |
8.1 |
(8.3)% |
26.8 |
27.5 |
(2.5)% |
Net income (1) (2) |
3.6 |
3.6 |
(0.7)% |
11.5 |
11.0 |
4.7% |
Net income per diluted share (1)
(2) |
$0.16 |
$0.16 |
-- |
$0.51 |
$0.48 |
6.3% |
|
|
|
|
|
|
|
(1) Station operating
income, operating income, net income and net income per diluted
share for the twelve month period ended December 31, 2012 benefited
from a pre-tax $0.8 million music license fee settlement with BMI
which had the effect of reducing station operating expenses during
the period. |
(2) Net income and net
income per diluted share for the twelve month period ended December
31, 2013 was impacted by a pre-tax $1.0 million fee incurred in
connection with debt pre-payment and a non-cash pre-tax charge of
$1.3 million for loss on extinguishment of long-term debt incurred
in connection with an amended credit agreement and the debt
pre-payment. Net income and net income per diluted share for
the twelve month period ended December 31, 2012 reflects a non-cash
pre-tax charge of $2.6 million for loss on extinguishment of
long-term debt. |
The $0.1 million, or 0.5%, decline in net revenue during the
three months ended December 31, 2013 primarily reflects the impact
of a reduction in political advertising compared with the same
period in 2012.
Lower net revenue in the 2013 fourth quarter and a $0.4 million,
or 2.5%, increase in station operating expenses related to
operating KVGS-FM in Las Vegas which was acquired in September
2013, as well as a rise in sales and programming expenses, caused
fourth quarter 2013 station operating income (SOI), a non-GAAP
financial measure, to decrease by $0.6 million, or 5.2%, to $10.2
million, as compared to the 2012 fourth quarter. The $0.7
million, or 8.3% year-over-year reduction in 2013 fourth quarter
operating income is primarily attributable to the year-over-year
revenue decline and a $0.5 million or 2.7% increase in total
operating expenses compared with fourth quarter 2012
levels.
Interest expense in the 2013 fourth quarter declined by 34.3%,
or $0.7 million, reflecting the lower cost of borrowing resulting
from the refinancing of the second lien debt in the second quarter
of 2013 and reduced amounts outstanding. Income tax expense in
the 2013 fourth quarter of $2.4 million was flat with the 2012
fourth quarter, reflecting flat pre-tax income for both
periods. Fourth quarter 2013 net income and net income per
diluted share was $3.6 million and $0.16, respectively, which
compares with net income and net income per diluted share of $3.6
million and $0.16, respectively, in the same period last year.
Please refer to the "Calculation of SOI," "Reconciliation of SOI
to Net Income," "Calculation of Same-Station SOI," and
"Reconciliation of Same-Station SOI to Net Income" tables at the
end of this announcement for a discussion regarding SOI
calculations.
Commenting on the results, George G. Beasley, Chairman and Chief
Executive Officer, said, "Beasley Broadcast Group's fourth quarter
net revenue decline primarily reflects a reduction in political
spending as in the fourth quarter of 2012 we recorded approximately
$1.2 million in political advertising revenue. While we were
not able to fully offset the cyclical impact of political revenue,
the fourth quarter radio advertising environment in our markets
remains healthy and on an actual basis we reported just a slight
decline in net revenue compared with last year. Excluding the
benefit of political advertising in the year-ago quarter, Beasley
Broadcast Group's 2013 fourth quarter same station net revenue rose
approximately 2% and, reflecting our success throughout 2013,
actual full year net revenue rose 4.7% while same station net
revenue for 2013 was up 1.9% versus full year 2012.
"Overall, for our five markets that report to Miller Kaplan –
which represent approximately 76% of total fourth quarter revenue –
Beasley station cluster revenue declined by 2.6%, which again was
primarily attributable to the cyclical nature of political
advertising, while the total revenue for all reporting radio
stations in these markets decreased by 4.1% for the
quarter. Beasley Broadcast Group's out-performance relative to
our markets again highlights the benefit of our organization-wide
focus on strong core programming and targeted localism. Our
planned investments in sales and programming and the expansion of
our digital offerings, combined with the revenue decline, led to
fourth quarter 2013 SOI which was 5.2% below year-ago levels.
"In addition to our focus on core programming and expanding our
on-air and digital advertising platforms, we continue to strengthen
our balance sheet. Reflecting strong operating cash flow, we
made repayments totaling $3.4 million against the credit facility
during the fourth quarter, reducing borrowings to $106.9 million at
December 31, 2013 from $116.8 million at the end of 2012. Our
debt and leverage reduction initiatives over the last few years are
benefiting our bottom line, as fourth quarter interest expense
declined year-over-year by over 34%, or approximately $0.7 million,
while our leverage ratio is at its lowest level in over 10
years. We intend to continue using cash from operations to
further lower debt and to pursue other initiatives to enhance
shareholder value. In this regard, during the fourth quarter
the Company re-initiated a quarterly cash dividend of $0.045 per
share with the first dividend paid earlier this month.
"In 2014, we remain focused on ensuring that our station
clusters match or exceed their market's revenue performance while
further strengthening our balance sheet. We have strong
station clusters and ratings in key markets and excellent
leadership and personnel across our organization. We believe
our focus on our core content and new media opportunities positions
Beasley Broadcast Group to deliver compelling entertainment to
radio users, a high value media buy for advertisers and profitable
station and digital revenue growth for the Company."
Webcast Information
The Company will host a webcast today, January 30, 2014, at
10:00 a.m. ET to discuss its financial results and
operations. Interested parties may access the webcast at the
Company's web site at www.bbgi.com. Following its completion,
a replay of the webcast can be accessed for five days on the
Company's web site, www.bbgi.com.
About Beasley Broadcast Group
Founded in 1961, Beasley Broadcast Group, Inc., www.bbgi.com, is
a radio broadcasting company that owns and operates 44 stations (28
FM and 16 AM) located in eleven large- and mid-size markets in the
United States. The Company also operates one station in the
expanded AM band in Augusta, GA.
Definitions
Station Operating Income (SOI) consists of net revenue less
station operating expenses. We define station operating
expenses as cost of services and selling, general and
administrative expenses.
Same-station results, as presented herein, compare stations
operated by the Company throughout all periods presented in the
following tables. For the three months ended December 31,
2013, same-station results exclude revenue and expenses from
KVGS-FM in Las Vegas. For the twelve months ended December 31,
2013, same-station results exclude revenue and expenses from
KOAS-FM and KVGS-FM in Las Vegas. For the twelve months ended
December 31, 2012, same-station results exclude revenue and
expenses from KOAS-FM. KVGS-FM was acquired during the 2013 third
quarter and KOAS-FM was acquired during the 2012 third quarter.
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 and
same-station SOI excludes corporate-level costs and expenses 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 on our statements of operations contained in
our periodic reports filed with the Securities and Exchange
Commission (SEC).
SOI is a measure widely used in the radio broadcast
industry. 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. However, 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 the 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 "guidance," "may," "will," "could," "should,"
"forecasts," "expects," "intends," "plans," "anticipates,"
"projects," "outlook," "believes," "estimates," "predicts,"
"potential," "continue," "preliminary," or the negative of these
terms or other comparable terminology are intended to identify such
forward-looking statements. Key risks are described in our
reports filed with the SEC including in our Annual Report on Form
10-K for the year ended December 31, 2012. Readers should note
that forward-looking statements are subject to change and to
inherent risks and uncertainties and may be impacted by several
factors, including: external economic forces that could have a
material adverse impact on our advertising revenues and results of
operations; our radio stations may not be able to compete
effectively in their respective markets for advertising revenues;
we may not remain competitive if we do not respond to changes in
technology, standards and services that affect our industry; our
substantial debt levels; and, the loss of key personnel. 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" in 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. All information in this release is as of January
30, 2014, and we undertake no obligation to update the information
contained herein to actual results or changes to our
expectations.
-tables follow-
BEASLEY BROADCAST
GROUP, INC. Consolidated Statements of Operations
(Unaudited) |
|
|
|
|
|
|
Three Months
Ended December 31, |
Twelve Months
Ended December 31, |
|
2013 |
2012 |
2013 |
2012 |
Net revenue |
$27,287,516 |
$27,436,531 |
$104,905,720 |
$100,240,597 |
Operating expenses: |
|
|
|
|
Station operating expenses (including
stock-based compensation and excluding depreciation and
amortization shown separately below) (1) (2) |
17,061,663 |
16,647,629 |
67,044,139 |
62,528,795 |
Corporate general and administrative
expenses (including stock-based compensation) (3) |
2,243,679 |
2,184,057 |
8,624,395 |
8,105,250 |
Other operating expenses |
-- |
-- |
185,916 |
-- |
Depreciation and amortization |
580,233 |
533,703 |
2,220,641 |
2,097,179 |
Total operating expenses |
19,885,575 |
19,365,389 |
78,075,091 |
72,731,224 |
Operating income |
7,401,941 |
8,071,142 |
26,830,629 |
27,509,373 |
Non-operating income (expense): |
|
|
|
|
Interest expense |
(1,370,072) |
(2,083,896) |
(7,081,801) |
(6,488,521) |
Loss on extinguishment of long-term
debt |
-- |
44,179 |
(1,260,784) |
(2,563,979) |
Other income (expense), net |
(16,635) |
12,812 |
89,758 |
(178,716) |
Income before income taxes |
6,015,234 |
6,044,237 |
18,577,802 |
18,278,157 |
Income tax expense |
2,434,318 |
2,438,956 |
7,031,539 |
7,246,887 |
Net income |
$3,580,916 |
$3,605,281 |
$11,546,263 |
$11,031,270 |
|
|
|
|
|
Basic net income per share |
$ 0.16 |
$ 0.16 |
$ 0.51 |
$ 0.49 |
Diluted net income per share |
$ 0.16 |
$ 0.16 |
$ 0.51 |
$ 0.48 |
Basic common shares outstanding |
22,745,384 |
22,677,296 |
22,735,774 |
22,667,102 |
Diluted common shares outstanding |
22,857,365 |
22,759,429 |
22,838,209 |
22,748,962 |
|
|
|
|
|
|
|
|
|
|
(1) We refer to "Cost of
services," and "Selling, general and administrative" together as
"station operating expenses" for the "Calculation of SOI" and
"Reconciliation of SOI to Net Income" below. |
|
|
|
|
|
(2) Includes stock-based
compensation of $(4,458) and $(7,923) for the three months ended
December 31, 2013 and 2012, respectively and $21,371 and $4,330 for
the twelve months ended December 31, 2013 and 2012,
respectively. |
|
|
|
|
|
(3) Includes stock-based
compensation of $191,471 and $95,973 for the three months ended
December 31, 2013 and 2012, respectively and $671,724 and $429,739
for the twelve months ended December 31, 2013 and 2012,
respectively. |
|
|
|
Selected Balance Sheet
Data - Unaudited (in thousands) |
|
|
|
|
December 31,
2013 |
December 31,
2012 |
Cash and cash equivalents |
$ 14,299 |
$ 11,661 |
Working capital |
21,535 |
20,754 |
Total assets |
264,209 |
259,373 |
Long term debt, less current portion |
102,625 |
113,250 |
Total stockholders' equity |
$ 93,626 |
$ 83,049 |
|
|
|
|
Selected Statement of
Cash Flows Data – Unaudited |
|
|
|
Twelve Months
Ended December 31, |
|
2013 |
2012 |
Net cash provided by operating
activities |
$ 19,913,684 |
$ 20,404,535 |
Net cash used in investing activities |
(6,655,233) |
(3,787,370) |
Net cash used in financing activities |
(10,620,086) |
(18,566,586) |
Net increase (decrease) in cash and cash
equivalents |
$ 2,638,365 |
$ (1,949,421) |
|
|
Calculation of
SOI – Unaudited |
|
|
|
|
Three Months
Ended December 31, |
Twelve
Months Ended December
31, |
|
2013 |
2012 |
2013 |
2012 |
Net revenue |
$ 27,287,516 |
$ 27,436,531 |
$ 104,905,720 |
$ 100,240,597 |
Station operating expenses |
(17,061,663) |
(16,647,629) |
(67,044,139) |
(62,528,795) |
SOI |
$ 10,225,853 |
$ 10,788,902 |
$ 37,861,581 |
$ 37,711,802 |
|
|
|
|
|
|
|
|
|
|
Reconciliation of SOI
to Net Income - Unaudited |
|
|
|
|
Three Months
Ended December 31, |
Twelve
Months Ended December
31, |
|
2013 |
2012 |
2013 |
2012 |
SOI |
$ 10,225,853 |
$ 10,788,902 |
$ 37,861,581 |
$ 37,711,802 |
Corporate general and administrative
expenses |
(2,243,679) |
(2,184,057) |
(8,624,395) |
(8,105,250) |
Other operating expenses |
-- |
-- |
(185,916) |
-- |
Depreciation and amortization |
(580,233) |
(533,703) |
(2,220,641) |
(2,097,179) |
Interest expense |
(1,370,072) |
(2,083,896) |
(7,081,801) |
(6,488,521) |
Loss on extinguishment of long-term debt |
-- |
44,179 |
(1,260,784) |
(2,563,979) |
Other income (expense), net |
(16,635) |
12,812 |
89,758 |
(178,716) |
Income tax expense |
(2,434,318) |
(2,438,956) |
(7,031,539) |
(7,246,887) |
Net income |
$ 3,580,916 |
$ 3,605,281 |
$ 11,546,263 |
$ 11,031,270 |
|
|
|
Calculation of
Same-Station SOI - Unaudited |
|
|
|
|
Three Months
Ended December 31, |
Twelve
Months Ended December
31, |
|
2013 |
2012 |
2013 |
2012 |
Reported net revenue |
$ 27,287,516 |
$ 27,436,531 |
$ 104,905,720 |
$ 100,240,597 |
|
KOAS-FM |
-- |
-- |
(3,311,532) |
(1,252,318) |
|
KVGS-FM |
(555,766) |
-- |
(688,922) |
-- |
|
Same-station net revenue |
$ 26,731,750 |
$ 27,436,531 |
$ 100,905,266 |
$ 98,988,279 |
|
|
|
|
|
|
|
Reported station operating expenses |
$ 17,061,663 |
$ 16,647,629 |
$ 67,044,139 |
$ 62,528,795 |
|
KOAS-FM |
-- |
-- |
(1,593,400) |
(628,936) |
|
KVGS-FM |
(319,105) |
-- |
(420,427) |
-- |
|
Same-station operating expenses |
$ 16,742,558 |
$ 16,647,629 |
$ 65,030,312 |
$ 61,899,859 |
|
|
|
|
|
|
|
Same-station net revenue |
$ 26,731,750 |
$ 27,436,531 |
$ 100,905,266 |
$ 98,988,279 |
|
Same-station operating expenses |
16,742,558 |
16,647,629 |
65,030,312 |
61,899,859 |
|
Same-station SOI |
$ 9,989,192 |
$ 10,788,902 |
$ 35,874,954 |
$ 37,088,420 |
|
|
|
Reconciliation of
Same-Station SOI to Net Income -
Unaudited |
|
|
|
|
Three Months
Ended December 31, |
Twelve
Months Ended December
31, |
|
2013 |
2012 |
2013 |
2012 |
Same-station SOI |
$ 9,989,192 |
$ 10,788,902 |
$ 35,874,954 |
$ 37,088,420 |
Same-station net revenue adjustment |
555,766 |
-- |
4,000,454 |
1,252,318 |
Same-station station operating expenses
adjustment |
(319,105) |
-- |
(2,013,827) |
(628,936) |
Corporate general and administrative
expenses |
(2,243,679) |
(2,184,057) |
(8,624,395) |
(8,105,250) |
Other operating expenses |
-- |
-- |
(185,916) |
-- |
Depreciation and amortization |
(580,233) |
(533,703) |
(2,220,641) |
(2,097,179) |
Interest expense |
(1,370,072) |
(2,083,896) |
(7,081,801) |
(6,488,521) |
Loss on extinguishment of long-term debt |
-- |
44,179 |
(1,260,784) |
(2,563,979) |
Other income (expense), net |
(16,635) |
12,812 |
89,758 |
(178,716) |
Income tax expense |
(2,434,318) |
(2,438,956) |
(7,031,539) |
(7,246,887) |
Net income |
$ 3,580,916 |
$ 3,605,281 |
$ 11,546,263 |
$ 11,031,270 |
CONTACT: B. Caroline Beasley, Chief Financial Officer
Beasley Broadcast Group, Inc.
239/263-5000; email@bbgi.com
Joseph N. Jaffoni
JCIR
212/835-8500 or bbgi@jcir.com
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