Adjusted EBITDA Increases 2% and Adjusted
Net Income Per Share Increases 14%
Full Year Net Revenues Increase 2%, Adjusted
EBITDA Increases 10% and Adjusted Net Income Per Share Increases
19%
Entercom Communications Corp. (NYSE: ETM) today reported
financial results for the quarter ended December 31, 2019.
Fourth Quarter
Highlights
- Net revenues for the quarter were $414.1 million, up 1%
compared to $411.4 million in the fourth quarter of 2018
- Operating loss for the quarter was $455.5 million, which
included a non-cash impairment charge of $545 million ($520 million
net of taxes), compared to an operating loss of $377.6 million in
the fourth quarter of 2018
- Adjusted EBITDA for the quarter was $113.0 million, up 2%
compared to $111.1 million in the fourth quarter of 2018
- Net loss per diluted share for the quarter was $3.64 compared
to a net loss of $2.80 per diluted share in the fourth quarter of
2018
- Adjusted net income per diluted share for the quarter was $0.40
compared to $0.35 per diluted share in the fourth quarter of
2018
“I am pleased to report that Entercom achieved its fifth
consecutive quarter of growth, completing a year in which the
Company delivered strong financial performance as Net Revenue,
Adjusted EBITDA, and Adjusted Net Income Per Share grew 2% (3%
ex-political), 10%, and 19%, respectively”, stated David J. Field,
Entercom’s Chairman, President and Chief Executive Officer. “Our
significant investments in podcasting, digital, and data and
analytics, along with the expansion of our sports, networks and
events businesses, are beginning to reshape our Company and
position us for sustained growth as we enhance our integrated,
multi-platform offerings to advertisers increasingly interested in
the undervalued and emerging audio space.”
Additional Information
In February, the Company announced an agreement to sell Boston
station WAAF-FM to Educational Media Foundation (“EMF”) for $10.8
million in cash. EMF began programming the station on February 22
under a network affiliation agreement. The transaction is expected
to close in the second quarter of 2020.
In December, the Company executed a debt transaction in which it
extended the maturity of most of its revolving credit facility from
November 2022 to August 2024, lowered the margin on its Term Loan B
by 25 basis points and issued an additional $100 million of its
senior secured second-lien notes. The Company used the proceeds of
the additional notes to repay $97 million of its Term Loan B and
pay fees, expenses and accrued interest.
As of December 31, 2019, the Company had outstanding $887
million of senior debt under its credit facilities, $425 million in
second-lien notes and $400 million in senior notes (the amounts of
senior debt and senior notes both exclude unamortized premium). In
addition, the Company had $20 million in cash on hand.
Earnings Conference Call and Company
Information
Entercom will hold a conference call and simultaneous webcast
regarding the quarterly earnings release on Tuesday, February 25,
2020, at 10:00 AM Eastern Time. The public may access the
conference call by dialing Toll Free: (888) 889-0278 and Toll:
(773) 799-3659, passcode: Entercom (domestic and international
callers). Participants may also listen to a live webcast of the
call by visiting the “Investor Relations” section of Entercom’s
website at www.entercom.com. A replay of the conference call will
be available for one week by dialing (800) 873-2012. A webcast
replay of the conference call will be available beginning six hours
after the call on the Company’s website for a period of two weeks.
Additional information is available on the Company’s website at
www.entercom.com.
Certain Definitions
All references to per share data, unless stated otherwise, are
presented as per diluted share. All references to shares
outstanding, unless stated otherwise, are presented to exclude
unvested restricted stock units. All references to net debt are
outstanding debt net of cash on hand.
Station Expenses consist of station operating expenses excluding
non-cash compensation expense.
Corporate Expenses consist of corporate general and
administrative expenses excluding non-cash compensation
expense.
Station Operating Income consists of operating income (loss)
before: depreciation and amortization; time brokerage agreement
fees (income); corporate general and administrative expenses;
non-cash compensation expense (which is otherwise included in
station operating expenses); impairment loss; merger and
acquisition costs, other expenses related to the refinancing;
non-recurring expenses recognized for restructuring charges or
similar costs, including transition and integration costs; and gain
or loss on sale or disposition of assets.
Adjusted EBITDA consists of net income (loss) available to
common shareholders, adjusted to exclude: income taxes (benefit);
income from discontinued operations, net of income taxes or
benefit; total other income or expense; net interest expense;
depreciation and amortization; time brokerage agreement fees
(income); non-cash compensation expense (which is otherwise
included in station operating expenses and corporate G&A
expenses); other expenses related to the refinancing; impairment
loss, merger and acquisition costs, preferred stock dividends;
non-recurring expense recognized for restructuring charges or
similar costs, including transition and integration costs, loss on
early extinguishment of debt, and gain or loss on sale or
disposition of assets.
Adjusted Free Cash Flow consists of operating income (loss): (i)
plus depreciation and amortization; net (gain) loss on sale or
disposal of assets; non-cash compensation expense (which is
otherwise included in station operating expenses and corporate
general and administrative expenses); impairment loss; merger and
acquisition costs; other income and non-recurring expenses
recognized for restructuring charges or similar costs, including
transition and integration costs; income from discontinued
operations (excluding income taxes or tax benefit); and (ii) less
net interest expense (excluding amortization of deferred financing
costs or debt premium), Adjusted Income Taxes Paid, capital
expenditures and amortizable intangibles.
Net Capital Expenditures consists of capital expenditures,
including amortizable intangibles, adjusted to subtract reimbursed
tenant improvement allowances.
Adjusted Income Taxes Paid consist of income tax paid, adjusted
to exclude taxes paid related to the gain/loss on sale or exchange
of radio station assets; and taxes paid related to the gain/loss on
the sale of redundant property.
Adjusted Net Income (Loss) consists of net income (loss)
available to common shareholders adjusted to exclude: (i) income
taxes (benefit) as reported, including income taxes otherwise
included in income from discontinued operations; (ii) gain/loss on
sale of assets, derivative instruments and investments; (iii)
non-cash compensation expense; (iv) impairment loss; (v) merger and
acquisition costs, and non-recurring expenses recognized for
restructuring charges or similar costs, including transition and
integration costs; (vi) other expenses related to refinancing; and
(vii) gain/loss on early extinguishment of debt. For purposes of
comparability, income taxes are reflected at the expected statutory
federal and state income tax rate of 30% without discrete items of
tax.
Adjusted Net Income (Loss) Per Share - Diluted includes any
dilutive equivalent shares when not anti-dilutive. Convertible
Preferred Stock is treated as if it never converted for the
purposes of Adjusted Net Income (Loss) Per Share - Diluted.
Non-GAAP Financial
Measures
It is important to note that station operating income, station
expense, corporate expense, Adjusted EBITDA, Adjusted Net Income,
Adjusted Net Income (Loss) Per Share – Diluted, Adjusted Free Cash
Flow, Net Capital Expenditures and Adjusted Income Taxes Paid are
not measures of performance or liquidity calculated in accordance
with generally accepted accounting principles (“GAAP”). Management
believes that these measures are useful as a way to evaluate the
Company and the means for Management to evaluate our radio
stations’ performance and operations. Management believes that
these measures are useful to an investor in evaluating our
performance because they are widely used in the broadcast industry
as a measure of a radio company’s operating performance.
Certain adjusted non-GAAP financial measures are presented in
this release (e.g., Adjusted Net Income (Loss) and Adjusted Net
Income (Loss) Per Share - Diluted). The adjustments exclude
gain/loss on sale of assets, derivative instruments, and
investments; non-cash compensation expense, other income,
impairment loss, merger and acquisition costs, other expenses
related to the refinancing, and gain/loss on early extinguishment
of debt and non-recurring expenses recognized for restructuring
charges or similar costs, including transition and integration
costs. For purposes of comparability, income taxes are reflected at
the expected federal and state income tax rate of 30%, without
adjustment for discrete tax adjustments.
Management believes these adjusted non-GAAP measures provide
useful information to Management and investors by excluding certain
income, expenses and gains and losses that may not be indicative of
the Company’s core operating and financial results. Similarly,
Management believes these adjusted measures are a useful
performance measure because certain items included in the
calculation of net income (loss) may either mask or exaggerate
trends in the Company’s ongoing operating performance. Further, the
reconciliations corresponding to these adjusted measures, by
identifying the individual adjustments, provide a useful mechanism
for investors to consider these adjusted measures with some or all
of the identified adjustments.
Management uses these non-GAAP financial measures on an ongoing
basis to help track and assess the Company's financial performance.
You, however, should not consider non-GAAP measures in isolation or
as substitutes for net income (loss), operating income, or any
other measure for determining our operating performance that is
calculated in accordance with generally accepted accounting
principles. These non-GAAP measures are not necessarily comparable
to similarly titled measures employed by other companies. The
accompanying financial tables provide reconciliations to the
nearest GAAP measure of all non-GAAP measures provided in this
release.
Note Regarding Forward-Looking
Statements
The information in this news release is being widely
disseminated in accordance with the Securities and Exchange
Commission's Regulation FD.
This news announcement contains certain forward-looking
statements that are based upon current expectations and certain
unaudited information that is presented for illustrative purposes
only and involves certain risks and uncertainties within the
meaning of the U.S. Private Securities Litigation Reform Act of
1995. Additional information and key risks are described in the
Company’s filings on Forms S-4, 8-K, 10-Q and 10-K with the
Securities and Exchange Commission. Readers should note that these
statements might be impacted by several factors including changes
in the economic and regulatory climate and the business of radio
broadcasting, in general. The unaudited pro forma information and
same station operating data reflect adjustments and are presented
for comparative purposes only and do not purport to be indicative
of what has occurred or indicative of future operating results or
financial position. Accordingly, the Company’s actual performance
may differ materially from those stated or implied herein. The
Company assumes no obligation to publicly update or revise any
unaudited pro forma or forward-looking statements.
About Entercom Communications Corp.
Entercom Communications Corp. (NYSE: ETM) is a leading American
media and entertainment company reaching and engaging 170 million
people each month through its premier collection of highly rated,
award winning radio stations, digital platforms and live events. As
one of the country’s two largest radio broadcasters, Entercom
offers integrated marketing solutions and delivers the power of
local connection on a national scale with coverage of close to 90%
of persons 12+ in the top 50 markets. Entercom is the #1 creator of
live, original, local audio content and the nation’s unrivaled
leader in news and sports radio. Learn more about
Philadelphia-based Entercom at www.entercom.com, Facebook and
Twitter (@Entercom).
ENTERCOM
COMMUNICATIONS CORP.
FINANCIAL
DATA
(amounts in
thousands, except per share data)
(unaudited)
Three Months Ended
Twelve Months Ended
December 31,
December 31,
2019
2018
2019
2018
STATEMENTS OF
OPERATIONS
Net Revenues
$
414,118
$
411,375
$
1,489,929
$
1,462,567
Station Expenses
284,458
286,503
1,081,960
1,092,422
Station Expense - Non-Cash
Compensation
892
1,561
4,657
6,856
Corporate Expenses
21,636
13,725
72,777
61,197
Corporate Expenses - Non-Cash
Compensation
5,006
2,169
11,527
8,295
Depreciation And Amortization
12,079
14,543
45,331
44,288
Time Brokerage Agreement Expense
(Income)
-
324
106
(918)
Merger And Acquisition Costs
465
253
941
3,014
Impairment Loss
545,457
465,000
545,457
493,988
Restructuring Charges
1,023
2,811
6,976
5,830
Integration Costs
1,017
3,388
4,297
25,372
Other Expenses Related To Refinancing
2,533
-
4,397
-
Net (Gain) Loss On Sale Or Disposition of
Assets
(4,957)
(1,302)
(7,640)
(12,158)
Total Operating Expenses
869,609
788,975
1,770,786
1,728,186
Operating Income (Loss)
(455,491)
(377,600)
(280,857)
(265,619)
Net Interest Expense
24,683
26,088
100,103
101,121
Loss On Early Extinguishment Of Debt
265
-
2,046
-
Income (Loss) Before Income Taxes
(480,439)
(403,688)
(383,006)
(366,740)
Income Taxes (Benefit)
7,096
(17,113)
37,206
(4,153)
Net Income (Loss) Available To The Company
- Continuing Operations
(487,535)
(386,575)
(420,212)
(362,587)
Income From Discontinued Operations, Net
Of Income Taxes
-
(378)
-
1,152
Net Income (Loss) Available To Common
Shareholders
$
(487,535)
$
(386,953)
$
(420,212)
$
(361,435)
Net Income (Loss) From Continuing
Operations Available To Common Shareholders - Basic
$
(3.64)
$
(2.80)
$
(3.07)
$
(2.63)
Net Income (Loss) From Continuing
Operations Available To Common Shareholders - Diluted
$
(3.64)
$
(2.80)
$
(3.07)
$
(2.63)
Dividends Declared And Paid Per Common
Share
$
0.02
$
0.09
$
0.22
$
0.36
Weighted Common Shares Outstanding -
Basic
133,985
138,033
136,967
138,070
Weighted Common Shares Outstanding -
Diluted
133,985
138,033
136,967
138,070
SUPPLEMENTAL
DISCLOSURES OF CASH FLOW INFORMATION
Net Capital Expenditures
$
10,245
$
15,533
$
68,312
$
39,154
Adjusted Income Taxes Paid
$
18,757
$
-
$
27,218
$
18,172
Cash Dividends On Common Stock Declared
And Paid
$
2,679
$
12,367
$
30,273
$
49,770
SELECTED BALANCE
SHEET DATA
December 31,
December 31,
2019
2018
Cash and Cash Equivalents
$
20,393
$
122,893
Restricted Cash
$
-
$
69,365
Senior Debt - Term B Loan (Includes
Current Portion)
$
770,000
$
1,291,700
Senior Debt - Revolver (Includes Current
Portion)
$
117,000
$
180,000
Senior Secured Notes
$
425,000
$
-
Senior Notes
$
400,000
$
400,000
Total Shareholders' Equity
$
881,443
$
1,334,260
OTHER FINANCIAL DATA
Three Months Ended
Twelve Months Ended
December 31,
December 31,
2019
2018
2019
2018
Reconciliation Of
GAAP Operating Income To Station Operating Income
Operating Income
$
(455,491)
$
(377,600)
$
(280,857)
$
(265,619)
Corporate Expenses
21,636
13,725
72,777
61,197
Corporate Expenses - Non-Cash
Compensation
5,006
2,169
11,527
8,295
Station Expenses - Non-Cash
Compensation
892
1,561
4,657
6,856
Depreciation And Amortization
12,079
14,543
45,331
44,288
Merger And Acquisition Costs
465
253
941
3,014
Restructuring Charges
1,023
2,811
6,976
5,830
Impairment Loss
545,457
465,000
545,457
493,988
Other Expenses Related To Refinancing
2,533
-
4,397
-
Integration Costs
1,017
3,388
4,297
25,372
Net Time Brokerage Agreement Expense
(Income)
-
324
106
(918)
Net Gain (Loss) On Sale Or Disposition of
Assets
(4,957)
(1,302)
(7,640)
(12,158)
Station Operating Income
$
129,660
$
124,872
$
407,969
$
370,145
Reconciliation Of
GAAP Net Income (Loss) Available To Common Shareholders To Adjusted
EBITDA
Net (Income) Loss Available To Common
Shareholders
$
(487,535)
$
(386,953)
$
(420,212)
$
(361,435)
Income Taxes (Benefit)
7,096
(17,113)
37,206
(4,153)
Income From Discontinued Operations, Net
Of Income Taxes
-
378
-
(1,152)
Net Interest Expense
24,683
26,088
100,103
101,121
Corporate Expenses - Non-Cash
Compensation
5,006
2,169
11,527
8,295
Station Expenses - Non-Cash
Compensation
892
1,561
4,657
6,856
Depreciation And Amortization
12,079
14,543
45,331
44,288
Time Brokerage Agreement Expense
(Income)
-
324
106
(918)
Merger And Acquisition Costs
465
253
941
3,014
Restructuring Charges
1,023
2,811
6,976
5,830
Integration Costs
1,017
3,388
4,297
25,372
Transition Costs And Non-Recurring
Expenses Otherwise Included In Corporate Expenses
5,000
-
6,000
1,100
Impairment Loss
545,457
465,000
545,457
493,988
Other Expenses Related To Refinancing
2,533
-
4,397
-
Loss On Early Extinguishment Of Debt
265
-
2,046
-
Net Gain (Loss) On Sale Or Disposition of
Assets
(4,957)
(1,302)
(7,640)
(12,158)
Adjusted EBITDA
$
113,024
$
111,147
$
341,192
$
310,048
Reconciliation Of
GAAP Net Income (Loss) Available To Common Shareholders To Adjusted
Free Cash Flow
Net Income (Loss) Available To Common
Shareholders
$
(487,535)
$
(386,953)
$
(420,212)
$
(361,435)
Depreciation And Amortization
12,079
14,543
45,331
44,288
Deferred Financing Costs Included In
Interest Expense
856
800
3,083
3,189
Amortization Debt Premium Included In
Interest Expense
(679)
(715)
(2,927)
(2,862)
Non-Cash Compensation Expense
5,898
3,730
16,184
15,151
Merger And Acquisition Costs
465
253
941
3,014
Integration Costs
1,017
3,388
4,297
25,372
Restructuring Charges
1,023
2,811
6,976
5,830
Transition Costs And Non-Recurring
Expenses Otherwise Included In Corporate Expenses
5,000
-
6,000
1,100
Impairment Loss
545,457
465,000
545,457
493,988
Net (Gain) Loss On Sale Or Disposition of
Assets
(4,957)
(1,302)
(7,640)
(12,158)
Other Expenses Related To Refinancing
2,533
-
4,397
-
Loss On Early Extinguishment Of Debt
265
-
2,046
-
Income Taxes (Benefit)
7,096
(17,113)
37,206
(4,153)
Income Taxes Otherwise Included In Income
From Discontinued Operations
-
(96)
-
613
Net Capital Expenditures, Including
Amortizable Intangibles
(10,245)
(15,533)
(68,312)
(39,154)
Adjusted Income Taxes Paid
(18,757)
-
(27,218)
(18,172)
Adjusted Free Cash Flow
$
59,516
$
68,813
$
145,609
$
154,611
Reconciliation Of
Capital Expenditures, Including Amortizable Intangibles, To Net
Capital Expenditures
Capital Expenditures, Including
Amortizable Intangibles
$
(14,326)
$
(15,831)
$
(77,901)
$
(41,786)
Reimbursed Tenant Improvement
Allowance
4,081
298
9,589
2,632
Net Capital Expenditures
$
(10,245)
$
(15,533)
$
(68,312)
$
(39,154)
Reconciliation Of
Income Taxes Paid To Adjusted Income Taxes Paid
Income Taxes Paid
$
(20,619)
$
(35,396)
$
(39,100)
$
(54,217)
Income Taxes Paid Related to Gain/Loss On
Sale Or Exchange Of Radio Station Assets
-
28,949
894
29,598
Income Taxes Paid Related to Gain/Loss On
Sale Of Redundant Properties
1,862
6,447
10,988
6,447
Adjusted Income Taxes Paid
$
(18,757)
$
-
$
(27,218)
$
(18,172)
Reconciliation Of
GAAP Net Income (Loss) Available To Common Shareholders To Adjusted
Net Income
Net Income (Loss) Available To Common
Shareholders
$
(487,535)
$
(386,953)
$
(420,212)
$
(361,435)
Income Taxes (Benefit)
7,096
(17,113)
37,206
(4,153)
Income Taxes Otherwise Included In Income
From Discontinued Operations
-
(96)
-
613
Merger And Acquisition Costs
465
253
941
3,014
Transition Costs And Non-Recurring
Expenses Otherwise Included In Corporate Expenses
5,000
-
6,000
1,100
Other Expenses Related To Refinancing
2,533
-
4,397
-
Impairment Loss
545,457
465,000
545,457
493,988
Integration Costs
1,017
3,388
4,297
25,372
Restructuring Charges
1,023
2,811
6,976
5,830
Loss On Early Extinguishment Of Debt
265
-
2,046
-
Net (Gain) Loss On Sale Or Disposition of
Assets
(4,957)
(1,302)
(7,640)
(12,158)
Non-Cash Compensation Expense
5,898
3,730
16,184
15,151
Adjusted Income Before Income Taxes
76,262
69,718
195,652
167,322
Income Taxes
22,879
20,915
58,696
50,197
Adjusted Net Income
$
53,383
$
48,803
$
136,956
$
117,125
Weighted Average
Diluted Shares Outstanding For Purposes Of Computing Adjusted Net
Income Per Share - Diluted
Weighted Common Shares Outstanding -
Diluted As Reported
133,985
138,033
136,967
138,070
Diluted Shares Excluded When Reporting A
Net Loss
130
384
331
775
134,115
138,417
137,298
138,845
Adjusted Net Income (Loss) Per Share -
Diluted
$
0.40
$
0.35
$
1.00
$
0.84
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200225005275/en/
Joseph Jaffoni, Jennifer Neuman, Norberto Aja JCIR (212)
835-8500 etm@jcir.com
Entercom Communications (NYSE:ETM)
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