Beasley Broadcast Group, Inc. (Nasdaq: BBGI) (“Beasley” or the
“Company”), a multi-platform media company, today announced
operating results for the three- and six-month periods ended June
30, 2022.
Summary of Second Quarter and
Year-to-Date Results
In millions, except per share data |
Three Months EndedJune 30, |
Six Months EndedJune 30, |
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
Net revenue |
$ |
64.8 |
|
$ |
59.6 |
|
$ |
120.5 |
|
$ |
107.8 |
|
Operating income (loss) 1 |
|
(4.5 |
) |
|
5.8 |
|
|
(7.3 |
) |
|
3.3 |
|
Net income (loss) 1 |
|
(14.5 |
) |
|
0.2 |
|
|
(18.0 |
) |
|
(10.5 |
) |
Net income (loss) per diluted share 1 |
$ |
(0.48 |
) |
$ |
0.01 |
|
$ |
(0.61 |
) |
$ |
(0.35 |
) |
Station operating income (SOI - non-GAAP) |
|
11.2 |
|
|
11.1 |
|
|
16.9 |
|
|
16.3 |
|
- Operating income (loss) and net
income (loss) per diluted share reflect an $8.6 million non-cash
impairment loss in the three months ended June 30, 2022, and $1.5
million in other operating income, net in the three months ended
June 30, 2021. Operating income (loss) and net loss per diluted
share reflect a $10.5 million non-cash impairment loss in the six
months ended June 30, 2022. Net loss attributable to BBGI
stockholders and net loss per diluted share reflect a $5.0 million
loss on extinguishment of long-term debt in the six months ended
June 30, 2021.
Net revenue during the three months ended June
30, 2022 increased 8.8% to $64.8 million, primarily reflecting a
year-over-year increase in audio and digital revenue due to the
continued recovery of the commercial advertising market from the
effects of the COVID-19 pandemic and higher political advertising
revenue.
Beasley reported an operating loss of $4.5
million in the second quarter of 2022 compared to operating income
of $5.8 million in the second quarter of 2021. The operating loss
in the second quarter of 2022 primarily reflects an $8.6 million
non-cash impairment loss due to an increase in the discount rate
used in the analyses to estimate the fair value of FCC licenses and
goodwill in a rising interest rate environment. For the comparable
three months ended June 30, 2021, the Company recorded $1.5 million
of other operating income, net from life insurance proceeds related
to the death of George Beasley, the Company’s former Chairman.
As a result of these factors, Beasley reported a
net loss of $14.5 million, or a negative $0.48 per diluted share,
in the three months ended June 30, 2022, compared to net income of
$0.2 million, or $0.01 per diluted share, in the three months ended
June 30, 2021.
SOI increased by $0.1 million to $11.2 million
in the second quarter of 2022 from $11.1 million in the second
quarter of 2021. The increase is primarily attributable to higher
net revenue, which more than offset higher operating expenses.
Please refer to the “Calculation of SOI” and
“Reconciliation of Net Income (Loss) Attributable to BBGI
Stockholders to SOI” tables at the end of this announcement for a
discussion regarding SOI calculations.
Commenting on the financial results, Caroline
Beasley, Chief Executive Officer, said, “Beasley delivered another
period of strong top-line results in the second quarter, reflecting
solid year-over-year growth across all of our revenue sources. Net
revenue increased 8.8%, inclusive of a 4.3% rise in audio revenue
and a 34.3% rise in digital revenue, with digital accounting for
16.5% of second quarter net revenue.
“Digital remains a central component of our
revenue diversification strategy, and the momentum we are seeing in
our digital business is further underpinned by our ability to grow
digital revenue 37% on a quarterly sequential basis, while also
improving our digital margin. Our new business performance was
robust this quarter, as we recorded $7.8 million in new business
revenue, representing a 60% increase from the first quarter of 2022
and 16% growth over the comparable prior year period. In addition,
we acquired a small white label digital agency at the end of June,
which will immediately contribute positive cash flow and synergies.
We believe these results continue to demonstrate the inaccuracy of
the perception that radio is more challenged than other segments of
the technology, media, and telecom sectors.
“Total outstanding debt as of June 30, 2022 was
$295.0 million, and we had $45.9 million of cash and cash
equivalents on hand at quarter end. We repurchased $5.0 million of
our 8.625% senior secured notes at a discount early in the second
quarter, and made an interest payment of $12.9 million subsequent
to quarter end. Our strong liquidity position enables us to make
debt repayments while providing us with the financial flexibility
to pursue a potential acquisition or investment in the digital
space, should an opportunity arise that could accelerate our
digital growth, provide synergies or improve financial results.
“We are keeping a close eye on the declining
economic environment and initiated cost reductions beginning in the
second quarter. Looking ahead, we will continue to focus on
controlling what we can control, maximizing our growth
opportunities, managing our expenses and capital structure, serving
our audiences and advertisers and delivering results for our
stockholders.”
Conference Call and Webcast
InformationThe Company will host a conference call and
webcast today, August 1, 2022, at 10:00 a.m. ET to discuss its
financial results and operations. To access the conference call,
interested parties may dial +1 773-377-9070, conference ID 9772619
(domestic and international callers). Participants can also listen
to a live webcast of the call at the Company’s website at
www.bbgi.com. Please allow 15 minutes to register and download and
install any necessary software. Following its completion, a replay
of the webcast can be accessed for five days on the Company’s
website, www.bbgi.com.
Questions from analysts, institutional investors
and debt holders may be e-mailed to ir@bbgi.com at any time up
until 9:00 a.m. ET on Monday, August 1, 2022. Management will
answer as many questions as possible during the conference call and
webcast (provided the questions are not addressed in their prepared
remarks).
About Beasley Broadcast
GroupThe Company owns and operates 61 stations (47 FM and
14 AM) in 14 large- and mid-size markets in the United States.
Approximately 20 million consumers listen to the Company’s radio
stations weekly over-the-air, online and on smartphones and
tablets, and millions regularly engage with the Company’s brands
and personalities through digital platforms such as Facebook,
Twitter, text messaging, digital and web applications and email.
The Overwatch League’s Houston Outlaws esports team is a wholly
owned subsidiary. The Company also owns BeasleyXP, a national
esports content hub, and AXLR-R8, a Rocket League Championship
Series team, in its esports portfolio. For more information, please
visit www.bbgi.com.
For further information, or to receive future
Beasley Broadcast Group news announcements via e-mail, please
contact Beasley Broadcast Group, at 239-263-5000 or email@bbgi.com,
or Joseph Jaffoni, JCIR, at 212-835-8500 or bbgi@jcir.com.
DefinitionsStation 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.
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.
Note Regarding Forward-Looking
StatementsStatements 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 “looking ahead,” “intends,”
“believes,” “expects,” “seek,” “will,” “should,” or variations of
such words and similar expressions are intended to identify such
forward-looking statements. Forward-looking statements by their
nature address matters that are, to different degrees, uncertain.
Key risks are described in the Company’s reports filed with the
Securities and Exchange Commission (“SEC”) including its annual
report on Form 10-K and quarterly reports on Form 10-Q. 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:
- the effects of the COVID-19
pandemic, including its potential effects on the economic
environment and our results of operations, liquidity and financial
condition;
- external economic forces that could
have a material adverse impact on our advertising revenues and
results of operations;
- the ability of our radio stations
to compete effectively in their respective markets for advertising
revenues;
- our ability to develop compelling
and differentiated digital content, products and services;
- audience acceptance of our content,
particularly our radio programs;
- our ability to respond to changes
in technology, standards and services that affect the radio
industry;
- our dependence on federally issued
licenses subject to extensive federal regulation;
- actions by the FCC or new
legislation affecting the radio industry;
- increases to royalties we pay to
copyright owners or the adoption of legislation requiring royalties
to be paid to record labels and recording artists;
- our dependence on selected market
clusters of radio stations for a material portion of our net
revenue;
- credit risk on our accounts
receivable;
- the risk that our FCC licenses
and/or goodwill could become impaired;
- our substantial debt levels and the
potential effect of restrictive debt covenants on our operational
flexibility and ability to pay dividends;
- the potential effects of hurricanes
on our corporate offices and radio stations;
- the failure or destruction of the
internet, satellite systems and transmitter facilities that we
depend upon to distribute our programming;
- disruptions or security breaches of
our information technology infrastructure;
- the loss of key personnel;
- our ability to integrate acquired
businesses and achieve fully the strategic and financial objectives
related thereto and their impact on our financial condition and
results of operations;
- the fact that our Company is
controlled by the Beasley family, which creates difficulties for
any attempt to gain control of our Company; and
- other economic, business,
competitive, and regulatory factors affecting our business,
including those set forth in our filings with the SEC.
Our actual performance and results could differ
materially because of these factors and other factors discussed in
our SEC filings, including but not limited to our 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 August 1, 2022, 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 |
|
Six months ended |
|
June 30, |
|
June 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net
revenue |
$ |
64,810,450 |
|
|
$ |
59,574,705 |
|
|
$ |
120,530,718 |
|
|
$ |
107,786,745 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
Operating expenses (including stock-based compensation and
excluding depreciation and amortization shown separately
below) |
|
53,626,592 |
|
|
|
48,494,420 |
|
|
|
103,636,141 |
|
|
|
91,462,291 |
|
Corporate expenses (including stock-based compensation) |
|
4,567,470 |
|
|
|
3,957,854 |
|
|
|
8,800,930 |
|
|
|
7,863,143 |
|
Depreciation and amortization |
|
2,451,102 |
|
|
|
2,850,923 |
|
|
|
4,967,002 |
|
|
|
5,802,824 |
|
Impairment losses |
|
8,619,097 |
|
|
|
- |
|
|
|
10,476,323 |
|
|
|
- |
|
Gain on disposition |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(191,988 |
) |
Other operating income, net |
|
- |
|
|
|
(1,500,000 |
) |
|
|
- |
|
|
|
(400,000 |
) |
Total operating expenses |
|
69,264,261 |
|
|
|
53,803,197 |
|
|
|
127,880,396 |
|
|
|
104,536,270 |
|
Operating income (loss) |
|
(4,453,811 |
) |
|
|
5,771,508 |
|
|
|
(7,349,678 |
) |
|
|
3,250,475 |
|
Non-operating income
(expense): |
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
(6,823,217 |
) |
|
|
(6,865,369 |
) |
|
|
(13,672,254 |
) |
|
|
(12,643,440 |
) |
Loss on extinguishment of long-term debt |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(4,996,731 |
) |
Other income, net |
|
190,210 |
|
|
|
8,080 |
|
|
|
191,082 |
|
|
|
46,493 |
|
Loss before income taxes |
|
(11,086,818 |
) |
|
|
(1,085,781 |
) |
|
|
(20,830,850 |
) |
|
|
(14,343,203 |
) |
Income tax expense
(benefit) |
|
3,554,469 |
|
|
|
(1,299,394 |
) |
|
|
(2,621,977 |
) |
|
|
(3,902,280 |
) |
Income (loss) before equity in earnings of unconsolidated
affiliates |
|
(14,641,287 |
) |
|
|
213,613 |
|
|
|
(18,208,873 |
) |
|
|
(10,440,923 |
) |
Equity in earnings of
unconsolidated affiliates, net of tax |
|
186,570 |
|
|
|
(25,919 |
) |
|
|
163,226 |
|
|
|
(56,024 |
) |
Net income (loss) |
|
(14,454,717 |
) |
|
|
187,694 |
|
|
|
(18,045,647 |
) |
|
|
(10,496,947 |
) |
Earnings attributable to
noncontrolling interest |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
129,249 |
|
Net income (loss) attributable to BBGI stockholders |
$ |
(14,454,717 |
) |
|
$ |
187,694 |
|
|
$ |
(18,045,647 |
) |
|
$ |
(10,367,698 |
) |
Basic and diluted net income
(loss) per share |
$ |
(0.48 |
) |
|
$ |
0.01 |
|
|
$ |
(0.61 |
) |
|
$ |
(0.35 |
) |
Basic common shares
outstanding |
|
29,418,951 |
|
|
|
29,235,009 |
|
|
|
29,395,003 |
|
|
|
29,268,717 |
|
Diluted common shares
outstanding |
|
29,418,951 |
|
|
|
29,324,614 |
|
|
|
29,395,003 |
|
|
|
29,268,717 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Balance Sheet Data -
Unaudited(in thousands)
|
|
June 30, |
|
|
|
December 31, |
|
|
|
2022 |
|
|
|
2021 |
|
Cash and cash equivalents |
$ |
45,918 |
|
|
$ |
51,379 |
|
Working capital |
|
53,519 |
|
|
|
67,696 |
|
Total assets |
|
748,610 |
|
|
|
762,088 |
|
Long-term debt, net of
unamortized debt issuance costs |
|
287,641 |
|
|
|
293,790 |
|
Stockholders' equity |
$ |
245,537 |
|
|
$ |
263,082 |
|
|
|
|
|
|
|
|
|
Selected Statement of Cash Flows Data –
Unaudited
|
Six months ended |
|
June 30, |
|
|
2022 |
|
|
|
2021 |
|
Net cash provided by operating
activities |
$ |
6,751,546 |
|
|
$ |
4,849,026 |
|
Net cash used in investing
activities |
|
(7,301,590 |
) |
|
|
(2,191,287 |
) |
Net cash provided by (used in)
financing activities |
|
(4,910,152 |
) |
|
|
33,723,920 |
|
Net increase (decrease) in
cash and cash equivalents |
$ |
(5,460,196 |
) |
|
$ |
36,381,659 |
|
|
|
|
|
|
|
|
|
Calculation of SOI
|
Three months ended |
|
Six months ended |
|
June 30, |
|
June 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net revenue |
$ |
64,810,450 |
|
|
$ |
59,574,705 |
|
|
$ |
120,530,718 |
|
|
$ |
107,786,745 |
|
Operating expenses |
|
(53,626,592 |
) |
|
|
(48,494,420 |
) |
|
|
(103,636,141 |
) |
|
|
(91,462,291 |
) |
SOI |
$ |
11,183,858 |
|
|
$ |
11,080,285 |
|
|
$ |
16,894,577 |
|
|
$ |
16,324,454 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Net Income (Loss)
Attributable to BBGI Stockholders to SOI
|
Three months ended |
|
Six months ended |
|
June 30, |
|
June 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net income (loss) attributable
to BBGI stockholders |
$ |
(14,454,717 |
) |
|
$ |
187,694 |
|
|
$ |
(18,045,647 |
) |
|
$ |
(10,367,698 |
) |
Corporate expenses |
|
4,567,470 |
|
|
|
3,957,854 |
|
|
|
8,800,930 |
|
|
|
7,863,143 |
|
Depreciation and
amortization |
|
2,451,102 |
|
|
|
2,850,923 |
|
|
|
4,967,002 |
|
|
|
5,802,824 |
|
Impairment losses |
|
8,619,097 |
|
|
|
- |
|
|
|
10,476,323 |
|
|
|
- |
|
Gain on dispositions |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(191,988 |
) |
Other operating income,
net |
|
- |
|
|
|
(1,500,000 |
) |
|
|
- |
|
|
|
(400,000 |
) |
Interest expense |
|
6,823,217 |
|
|
|
6,865,369 |
|
|
|
13,672,254 |
|
|
|
12,643,440 |
|
Loss on extinguishment of
long-term debt |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
4,996,731 |
|
Other income, net |
|
(190,210 |
) |
|
|
(8,080 |
) |
|
|
(191,082 |
) |
|
|
(46,493 |
) |
Income tax expense
(benefit) |
|
3,554,469 |
|
|
|
(1,299,394 |
) |
|
|
(2,621,977 |
) |
|
|
(3,902,280 |
) |
Equity in earnings of
unconsolidated affiliates, net of tax |
|
(186,570 |
) |
|
|
25,919 |
|
|
|
(163,226 |
) |
|
|
56,024 |
|
Earnings attributable to
noncontrolling interest |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(129,249 |
) |
SOI |
$ |
11,183,858 |
|
|
$ |
11,080,285 |
|
|
$ |
16,894,577 |
|
|
$ |
16,324,454 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONTACT: |
|
|
B. Caroline BeasleyChief Executive OfficerBeasley Broadcast Group,
Inc.239/263-5000 or ir@bbgi.com |
|
Joseph Jaffoni, Jennifer NeumanJCIR212/835-8500 or
bbgi@jcir.com |
|
|
|
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