• Cumulus Reports Operating Results for Second Quarter 2016

    Source: Nasdaq GlobeNewswire / 04 Aug 2016 16:02:46   America/New_York

    ATLANTA, Aug. 04, 2016 (GLOBE NEWSWIRE) -- Cumulus Media Inc. (NASDAQ:CMLS) (the “Company,” “we,” “us,” or “our”) today announced operating results for the three and six months ended June 30, 2016.   For the three months ended June 30, 2016, the Company reported net revenue of $287.2 million, down 4.1% from the three months ended June 30, 2015, net income of  $1.1 million, down 91.3% from the three months ended June 30, 2015, and Adjusted EBITDA of $63.2 million, down 21.8% from the quarter ended June 30, 2015.  For the six months ended June 30, 2016, the Company reported net revenue of $555.7 million, down 2.6% from the six months ended June 30, 2015, a net loss of $13.4 million and Adjusted EBITDA of $105.1 million, down 16.2% from the six months ended June 30, 2015. Mary Berner, President and Chief Executive Officer of Cumulus Media Inc. said, “The second quarter results underscore the substantial challenges that we must overcome.  However, our operating strategy is gaining measurable traction with significant ratings growth, improved employee engagement, reduced turnover and enhanced operational effectiveness. These are all critical first steps in the execution of our multi-year turnaround plan.” Operating Summary (in thousands, except percentages and per share data):  Three Months Ended June 30,  2016   2015  % ChangeNet revenue$ 287,193  $ 299,334  (4.1)%Net income$ 1,066  $ 12,299  (91.3)%Adjusted EBITDA (1)$ 63,180  $ 80,815  (21.8)%Basic and diluted income per share$ 0.00   $ 0.05      Six Months Ended June 30,  2016   2015  % ChangeNet revenue$ 555,723  $ 570,413  (2.6)%Net (loss) income$ (13,363) $ 284  **Adjusted EBITDA (1)$ 105,114  $ 125,478  (16.2)%Basic and diluted loss per share$ (0.06 ) $ 0.00               ** Calculation is not meaningful          June 30, 2016 December 31, 2015 % ChangeCash and cash equivalents $49,798  $31,657  57.3%        Term loans 1,838,940  $1,838,940  —%7.75% Senior Notes 610,000  610,000  —%Total debt $2,448,940  $2,448,940  —%  Three Months Ended June 30, 2016 2015 % ChangeCapital expenditures$7,301  $4,765  53.2%  Six Months Ended June 30, 2016 2015 % ChangeCapital expenditures$11,462  $14,860  (22.9)%            (1) Adjusted EBITDA is not a financial measure calculated or presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). For additional information, see “Non-GAAP Financial Measure and Definition”. Segment Results for Three Months Ended June 30, 2016 Net Revenue The Company operates two reportable segments, the Radio Station Group and Westwood One. Radio Station Group revenue is derived primarily from the sale of broadcasting time to local, regional and national advertisers. Westwood One revenue is generated primarily through network advertising. Corporate includes support for each of the Company’s reportable segments, including information technology, human resources, legal, finance and administrative functions, as well as overall executive, administrative and support functions. The following tables present our net revenue by segment (dollars in thousands).   Three Months Ended June 30, 2016  Radio Station Group Westwood One Corporate and Other ConsolidatedNet revenue $209,964  $76,530  $699  $287,193 % of total revenue 73.1% 26.7% 0.2% 100.0%$ change from three months ended June 30, 2015 $466  $(12,237) $(370) $(12,141)% change from three months ended June 30, 2015 0.2% (13.8)% (34.6)% (4.1)%   Three Months Ended June 30, 2015  Radio Station Group Westwood One Corporate and Other ConsolidatedNet revenue $209,498  $88,767  $1,069  $299,334 % of total revenue 70.0% 29.6% 0.4% 100.0%              Net income (loss) The following tables present our net income (loss) by segment (dollars in thousands).   Three Months Ended June 30, 2016  Radio Station Group Westwood One Corporate and Other ConsolidatedNet income (loss) $46,405  $887  $(46,226) $1,066 $ change from three months ended June 30, 2015 $(6,162) $(6,681) $1,610  $(11,233)% change from three months ended June 30, 2015 (11.7)% (88.3)% 3.4% (91.3)%   Three Months Ended June 30, 2015  Radio Station Group Westwood One Corporate and Other ConsolidatedNet income (loss) $52,567  $7,568  $(47,836) $12,299                   Adjusted EBITDA The following tables present our Adjusted EBITDA by segment (dollars in thousands).   Three Months Ended June 30, 2016  Radio Station Group Westwood One Corporate and Other ConsolidatedAdjusted EBITDA $59,321  $12,928  $(9,069) $63,180 $ change from three months ended June 30, 2015 $(11,712) $(5,584) $(339) $(17,635)% change from three months ended June 30, 2015 (16.5)% (30.2)% (3.9)% (21.8)%   Three Months Ended June 30, 2015  Radio Station Group Westwood One Corporate and Other ConsolidatedAdjusted EBITDA $71,033  $18,512  $(8,730) $80,815                   Segment Results for Six Months Ended June 30, 2016 Net Revenue The following tables present our net revenue by segment (dollars in thousands).   Six Months Ended June 30, 2016  Radio Station Group Westwood One Corporate and Other ConsolidatedNet revenue $386,441  $168,094  $1,188  $555,723 % of total revenue 69.5% 30.2% 0.3% 100.0%$ change from six months ended June 30, 2015 $1,275  $(15,222) $(743) $(14,690)% change from six months ended June 30, 2015 0.3% (8.3)% (38.5)% (2.6)%   Six Months Ended June 30, 2015  Radio Station Group Westwood One Corporate and Other ConsolidatedNet revenue $385,166  $183,316  $1,931  $570,413 % of total revenue 67.5% 32.2% 0.3% 100.0%              Net income (loss) The following tables present our net income (loss) by segment (dollars in thousands).   Six Months Ended June 30, 2016  Radio Station Group Westwood One Corporate and Other ConsolidatedNet income (loss) $71,144  $(1,998) $(82,509) $(13,363)$ change from six months ended June 30, 2015 $(7,956) $(8,358) $2,667  $(13,647)% change from six months ended June 30, 2015 (10.1)% (131.4)% (3.1)% (4,805.3)%   Six Months Ended June 30, 2015  Radio Station Group Westwood One Corporate and Other ConsolidatedNet income (loss) $79,100  $6,360  $(85,176) $284                   Adjusted EBITDA The following tables present our Adjusted EBITDA by segment (dollars in thousands).   Six Months Ended June 30, 2016  Radio Station Group Westwood One Corporate and Other ConsolidatedAdjusted EBITDA $103,041  $20,687  $(18,614) $105,114 $ change from six months ended June 30, 2015 $(13,408) $(6,249) $(707) $(20,364)% change from six months ended June 30, 2015 (11.5)% (23.2)% 3.9% (16.2)%   Six Months Ended June 30, 2015  Radio Station Group Westwood One Corporate and Other ConsolidatedAdjusted EBITDA $116,449  $26,936  $(17,907) $125,478                   The following table presents our net revenue by segment for each quarter during the year ended December 31, 2015 (dollars in thousands).   Radio Station Group Westwood One Corporate and Other Consolidated         Net revenue Q1 2015 $175,668  $94,549  $862  $271,079 Net revenue Q2 2015 209,498 88,767  1,069  299,334 Net revenue Q3 2015 204,677 84,071  693  289,441 Net revenue Q4 2015 206,540 101,581  704  308,825Net revenue FY 2015 $796,383  $368,968  $3,328  $1,168,679                   The following table presents our Adjusted EBITDA by segment for each quarter during the year ended December 31, 2015 (dollars in thousands).   Radio Station Group Westwood One Corporate and Other Consolidated         Adjusted EBITDA Q1 2015 $45,416  $8,424  $(9,177) $44,663 Adjusted EBITDA Q2 2015 71,033  18,512  (8,730) 80,815 Adjusted EBITDA Q3 2015 63,032  16,120  (8,532) 70,620 Adjusted EBITDA Q4 2015 62,192  9,902  (9,047) 63,047 Adjusted EBITDA FY 2015 $241,673  $52,958  $(35,486) $259,145                   Earnings Call InformationCumulus Media Inc. will host a teleconference today at 4:30 PM eastern time to discuss its second quarter 2016 operating results. The conference call dial-in number for domestic callers is 877-830-7699. International callers should dial 574-990-0924 for conference call access.  If prompted, the conference ID is 57711868. Please call five to ten minutes in advance to ensure that you are connected prior to the presentation. Following completion of the call, a replay can be accessed until 11:30 PM eastern time, September 4, 2016. Domestic callers can access the replay by dialing 866-247-4222, replay code 57711868. International callers should dial +44 (0)145255000 for conference replay access. An archive of the webcast will be available beginning 24 hours after the call for a period of 30 days. A link to the live audio webcast of the conference call and the related earnings presentation will be available on the investor section of the Cumulus Media Inc. website (www.cumulus.com/investors). Forward-Looking StatementsCertain statements in this release may constitute “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Such statements are statements other than historical fact and relate to our intent, belief or current expectations primarily with respect to certain historical and our future operating, financial, and strategic performance. Any such forward-looking statements are not guarantees of future performance and may involve risks and uncertainties. Actual results may differ from those contained in or implied by the forward-looking statements as a result of various factors including, but not limited to, risks and uncertainties relating to the need for additional funds to service our debt and to execute our business strategy, our ability to access borrowings under our revolving credit facility, our ability from time to time to renew one or more of our broadcast licenses, changes in interest rates, changes in the fair value of our investments, the timing of, and our ability to complete any acquisitions or dispositions pending from time to time, costs and synergies resulting from the integration of any completed acquisitions, our ability to effectively manage costs, our ability to generate and manage growth, the popularity of radio as a broadcasting and advertising medium, changing consumer tastes, the impact of general economic conditions in the United States or in specific markets in which we currently do business, industry conditions, including existing competition and future competitive technologies and cancellation, disruptions or postponements of advertising schedules in response to national or world events, our ability to generate revenues from new sources, including local commerce and technology-based initiatives, the impact of regulatory rules or proceedings that may affect our business from time to time, our ability to meet the listing standards for our Class A common stock to continue to be listed for trading on the NASDAQ stock market, the write off of a material portion of the fair value of our FCC broadcast licenses and goodwill, and other risk factors described from time to time  in our filings with the Securities and Exchange Commission, including our Form 10-K for the year ended December 31, 2015 (the “2015 Form 10-K”) and any subsequently filed Forms 10-Q. Many of these risks and uncertainties are beyond our control, and the unexpected occurrence or failure to occur of any such events or matters could significantly alter our actual results of operations or financial condition. Cumulus Media Inc. assumes no responsibility to update any forward-looking statement as a result of new information, future events or otherwise. About Cumulus MediaA leader in the radio broadcasting industry, Cumulus Media (NASDAQ:CMLS) combines high-quality local programming with iconic, nationally syndicated media, sports and entertainment brands to deliver premium content choices to the 245 million people reached each week through its 452 owned-and-operated stations broadcasting in 90 US media markets (including eight of the top 10), more than 8,200 broadcast radio stations affiliated with its Westwood One network and numerous digital channels. Together, the Cumulus/Westwood One platforms make Cumulus Media one of the few media companies that can provide advertisers with national reach and local impact. Cumulus/Westwood One is the exclusive radio broadcast partner to some of the largest brands in sports, entertainment, news, and talk, including the NFL, the NCAA, the Masters, the Olympics, the GRAMMYs, the Academy of Country Music Awards, the American Music Awards, the Billboard Music Awards, Westwood One News, and more. Additionally, it is the nation's leading provider of country music and lifestyle content through its NASH brand, which serves country fans nationwide through radio programming, exclusive digital content, and live events. For more information, visit www.cumulus.com.  CUMULUS MEDIA INC.Unaudited Condensed Consolidated Statements of Operations(Dollars in thousands, except per share data)   Three Months Ended June 30, Six Months Ended June 30,   2016   2015   2016   2015 Net revenue $287,193  $299,334  $555,723  $570,413 Operating expenses:        Content costs 97,133  91,019  197,178  191,826 Selling, general & administrative expenses 117,860  118,548  235,087  234,855 Depreciation and amortization 22,969  25,724  46,066  51,035 LMA fees 2,482  2,572  7,870  5,070 Corporate expenses 9,203  9,219  18,713  18,823 Stock-based compensation expense 790  3,880  1,668  7,743 Acquisition-related and restructuring costs 1,421  (603) 3,687  (603)(Gain) loss on sale of assets or stations (3,146) (84) (3,141) 735 Impairment of intangible assets and goodwill 1,816  —  1,816  — Impairment charges - equity interest in Pulser Media Inc. —  1,056  —  1,056 Total operating expenses 250,528  251,331  508,944  510,540 Operating income 36,665  48,003  46,779  59,873 Non-operating (expense) income:        Interest expense (34,486) (35,412) (68,967) (70,396)Interest income 140  27  225  385 Other (expense) income, net (4) 12,373  716  12,757 Total non-operating expense, net (34,350) (23,012) (68,026) (57,254)Income (loss) before income taxes 2,315  24,991  (21,247) 2,619 Income tax (expense) benefit (1,249) (12,692) 7,884  (2,335)Net income (loss) $1,066  $12,299  $(13,363) $284 Basic and diluted income (loss) per common share:        Basic:  Income (loss) per share $0.00  $0.05  $(0.06) $0.00 Diluted:  Income (loss) per share $0.00  $0.05  $(0.06) $0.00 Weighted average basic common shares outstanding 234,329,021  233,278,660  234,190,188  233,202,282 Weighted average diluted common shares outstanding 234,692,018  233,486,283  234,190,188  233,452,205               Non-GAAP Financial Measure and Definition From time to time we utilize certain financial measures that are not prepared or calculated in accordance with GAAP to assess our financial performance and profitability. Adjusted EBITDA is the financial metric utilized by management to analyze the cash flow generated by our business. This measure isolates the amount of income generated by our core operations before the incurrence of corporate expenses. Management also uses this measure to determine the contribution of our core operations to the funding of our corporate resources utilized to manage our operations and our non-operating expenses including debt service. In addition, Adjusted EBITDA is a key metric for purposes of calculating and determining our compliance with certain covenants contained in our credit facility. We define Adjusted EBITDA as net income (loss) before any non-operating expenses, including depreciation and amortization, stock-based compensation expense, gain or loss on sale of assets or stations (if any), gain or loss on derivative instruments (if any), impairment of assets (if any), acquisition-related and restructuring costs (if any) and franchise and state taxes. In deriving this measure, management excludes depreciation, amortization, and stock-based compensation expense, as these do not represent cash payments for activities directly related to our core operations. Management excludes any gain or loss on the exchange or sale of any assets or stations and any gain or loss on derivative instruments as they do not represent cash transactions nor are they associated with core operations. Expenses relating to acquisitions and restructuring costs are also excluded from the calculation of Adjusted EBITDA as they are not directly related to our core operations. Management excludes any non-cash costs associated with impairment of assets as they do not require a cash outlay. Management believes that Adjusted EBITDA, although not a measure that is calculated in accordance with GAAP, nevertheless is commonly employed by the investment community as a measure for determining the market value of media companies. Management has also observed that Adjusted EBITDA is routinely employed to evaluate and negotiate the potential purchase price for media companies and is a key metric for purposes of calculating and determining compliance with certain covenants in our credit facility. Given the relevance to our overall value, management believes that investors consider the metric to be extremely useful. Adjusted EBITDA should not be considered in isolation or as a substitute for net income, operating income, cash flows from operating activities or any other measure for determining the Company’s operating performance or liquidity that is calculated in accordance with GAAP. In addition, Adjusted EBITDA may be defined or calculated differently by other companies, and comparability may be limited. The following tables reconcile net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA for the three and six months ended June 30, 2016 and 2015 (dollars in thousands):   Three Months Ended June 30, 2016  Radio Station Group Westwood One Corporate and Other ConsolidatedNet income (loss) $46,405  $887  $(46,226) $1,066 Income tax expense —  —  1,249  1,249 Non-operating expense, including net interest expense 17  63  34,270  34,350 LMA fees 2,482  —  —  2,482 Depreciation and amortization 13,538  8,894  537  22,969 Stock-based compensation expense —  —  790  790 Gain on sale of assets or stations (3,121) —  (25) (3,146)Impairment of intangible assets —  1,816  —  1,816 Acquisition-related and restructuring costs —  1,268  153  1,421 Franchise and state taxes —  —  183  183 Adjusted EBITDA $59,321  $12,928  $(9,069) $63,180    Three Months Ended June 30, 2015  Radio Station Group Westwood One Corporate and Other ConsolidatedNet income (loss) $52,567  $7,568  $(47,836) $12,299 Income tax (benefit) expense (35) —  12,729  12,694 Non-operating (income) expense, including net interest expense (1) 320  22,692  23,011 LMA fees 2,572  —  —  2,572 Depreciation and amortization 16,014  9,158  551  25,723 Stock-based compensation expense —  —  3,880  3,880 Gain on sale of assets or stations (84) —  —  (84)Impairment charges - equity interest in Pulser Media Inc —  1,056  —  1,056 Acquisition-related and restructuring costs —  410  (1,013) (603)Franchise and state taxes —  —  267  267 Adjusted EBITDA $71,033  $18,512  $(8,730) $80,815    Six Months Ended June 30, 2016  Radio Station Group Westwood One Corporate and Other ConsolidatedNet income (loss) $71,144  $(1,998) $(82,509) $(13,363)Income tax benefit —  —  (7,884) (7,884)Non-operating expense, including net interest expense 16  166  67,844  68,026 LMA fees 7,870  —  —  7,870 Depreciation and amortization 27,127  17,876  1,063  46,066 Stock-based compensation expense —  —  1,668  1,668 Gain on sale of assets or stations (3,116) —  (25) (3,141)Impairment of intangible assets —  1,816  —  1,816 Acquisition-related and restructuring costs —  2,827  860  3,687 Franchise and state taxes —  —  369  369 Adjusted EBITDA $103,041  $20,687  $(18,614) $105,114    Six Months Ended June 30, 2015  Radio Station Group Westwood One Corporate and Other ConsolidatedNet income (loss) $79,100  $6,360  $(85,176) $284 Income tax (benefit) expense (2) —  2,337  2,335 Non-operating (income) expense, including net interest expense (1) 640  56,620  57,259 LMA fees 5,070  —  —  5,070 Depreciation and amortization 31,547  18,470  1,018  51,035 Stock-based compensation expense —  —  7,743  7,743 Loss on sale of assets or stations 735  —  —  735 Impairment charges -- equity interest in Pulser Media Inc —  1,056  —  1,056 Acquisition-related and restructuring costs —  410  (1,013) (603)Franchise and state taxes —  —  564  564 Adjusted EBITDA $116,449  $26,936  $(17,907) $125,478                   The following tables reconcile net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA for the three months ended March 31, 2015, September 30, 2015 and December 31, 2015, respectively (dollars in thousands):   Three Months Ended March 31, 2015  Radio Station Group Westwood One Corporate and Other ConsolidatedNet income (loss) $26,533  $(1,208) $(37,340) $(12,015)Income tax expense (benefit) 35  —  (10,392) (10,357)Non-operating (income) expense, including net interest expense (1) 320  33,928  34,247 LMA fees 2,498  —  —  2,498 Depreciation and amortization 15,532  9,312  467  25,311 Stock-based compensation expense —  —  3,863  3,863 Gain on sale of assets or stations 819  —  —  819 Franchise and state taxes —  —  297  297 Adjusted EBITDA $45,416  $8,424  $(9,177) $44,663    Three Months Ended September 30, 2015  Radio Station Group Westwood One Corporate and Other ConsolidatedNet loss $(388,139) $(145,345) $(8,695) $(542,179)Income tax benefit —  —  (60,855) (60,855)Non-operating expense (income), including net interest expense (2) 314  35,508  35,820 LMA fees 2,515  —  —  2,515 Depreciation and amortization 15,900  9,092  555  25,547 Stock-based compensation expense —  —  12,304  12,304 (Gain) loss on sale of assets or stations (50) —  107  57 Impairment of intangible assets 414,500  150,980  104  565,584 Impairment charges - equity interest in Pulser Media Inc 18,308  —  —  18,308 Acquisition-related and restructuring costs —  1,079  12,684  13,763 Franchise and state taxes —  —  (244) (244)Adjusted EBITDA $63,032  $16,120  $(8,532) $70,620    Three Months Ended December 31, 2015  Radio Station Group Westwood One Corporate and Other ConsolidatedNet income (loss) $43,776  $(2,195) $(46,180) $(4,599)Income tax expense —  —  12,680  12,680 Non-operating (income) expense, including net interest expense (2) 293  33,671  33,962 LMA fees 2,541  —  3  2,544 Depreciation and amortization 15,894  8,976  653  25,523 Stock-based compensation expense —  —  986  986 (Gain) loss on sale of assets or stations (17) 2,081  —  2,064 Acquisition-related and restructuring costs —  747  2,733  3,480 Franchise and state taxes —  —  (371) (371)Gain on early extinguishment of debt $—  $—  (13,222) (13,222)Adjusted EBITDA $62,192  $9,902  $(9,047) $63,047    For further information, please contact: Cumulus Media Inc. Collin Jones Investor Relations collin@cumulus.com 404-260-6600 []
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