Cumulus Media Inc. (NASDAQ: CMLS) (the “Company,” “we,” “us,” or
“our”) today announced operating results for the three months ended
March 31, 2019.
For the three months ended March 31, 2019, the Company
reported net revenue of $267.5 million, an increase of 1.4% from
the three months ended March 31, 2018, net income of $0.5
million and Adjusted EBITDA of $41.8 million, an increase of 3.8%
from the three months ended March 31, 2018.
Mary G. Berner, President and Chief Executive Officer of CUMULUS
MEDIA said, “Driven by a steady focus on our key strategic
priorities including accelerating digital growth, our strong
performance continued in Q1 2019 with year-over-year increases in
both revenue and EBITDA. Additionally, we now have four
pending M&A transactions that collectively are expected to
generate more than $120 million of net proceeds and bolster our
competitive positions in Indianapolis and Allentown. Combined
with the $25 million voluntary prepayment made in February, these
proceeds will reduce our net leverage to 4.8x on a pro forma
basis. We look forward to continuing our disciplined
execution against all our strategic priorities and financial goals
in the quarters ahead.”
Operating Summary (in thousands, except percentages and
per share data):
|
SuccessorCompany |
|
|
PredecessorCompany |
|
|
|
ThreeMonthsEndedMarch 31,2019 |
|
|
ThreeMonthsEndedMarch 31,2018 |
|
% Change |
Net revenue |
$ |
267,496 |
|
|
|
$ |
263,679 |
|
|
1.4 |
% |
Net income (loss) |
$ |
451 |
|
|
|
$ |
(5,001 |
) |
|
N/A |
Adjusted EBITDA (1) |
$ |
41,804 |
|
|
|
$ |
40,269 |
|
|
3.8 |
% |
Basic income (loss) per
share |
$ |
0.02 |
|
|
|
$ |
(0.17 |
) |
|
N/A |
Diluted income (loss) per
share |
$ |
0.02 |
|
|
|
$ |
(0.17 |
) |
|
N/A |
|
March 31, 2019 |
|
December 31,2018 |
|
% Change |
Cash and cash equivalents |
$ |
15,333 |
|
|
$ |
27,584 |
|
|
(44.4 |
)% |
Term loan |
$ |
1,214,668 |
|
|
$ |
1,243,299 |
|
|
(2.3 |
)% |
|
SuccessorCompany |
|
PredecessorCompany |
|
|
|
Three MonthsEnded March 31,2019 |
|
|
Three MonthsEnded March 31,2018 |
|
% Change |
Capital expenditures |
$ |
5,126 |
|
|
|
$ |
9,005 |
|
|
(43.1 |
)% |
(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." |
Results for Three Months Ended March 31,
2019
Net Revenue
The Company operates in two reportable segments, the Cumulus
Radio Station Group and Westwood One. Cumulus Radio Station Group
revenue is derived primarily from the sale of broadcasting time on
our owned or operated stations to local, regional and national
advertisers. Westwood One revenue is generated primarily through
network advertising on our owned or operated stations and on its
approximately 8,000 affiliate stations.
Corporate and Other includes overall executive, administrative
and support functions for both the Company’s reportable segments,
including accounting, finance, legal, human resources, information
technology and programming functions.
The following tables present our net revenue by segment (dollars
in thousands):
|
|
Three Months Ended March 31, 2019 (Successor
Company) |
|
|
CumulusRadio StationGroup |
|
WestwoodOne |
|
Corporateand Other |
|
Consolidated |
Net revenue |
|
$ |
166,541 |
|
|
$ |
100,359 |
|
|
$ |
596 |
|
|
$ |
267,496 |
|
% of total revenue |
|
62.3 |
% |
|
37.5 |
% |
|
0.2 |
% |
|
100.0 |
% |
$ change from three months ended
March 31, 2018 |
|
$ |
(1,684 |
) |
|
$ |
5,569 |
|
|
$ |
(68 |
) |
|
$ |
3,817 |
|
% change from three months ended
March 31, 2018 |
|
(1.0 |
)% |
|
5.9 |
% |
|
(10.2 |
)% |
|
1.4 |
% |
|
|
Three Months Ended March 31, 2018 (Predecessor
Company) |
|
|
CumulusRadio StationGroup |
|
WestwoodOne |
|
Corporateand Other |
|
Consolidated |
Net revenue |
|
$ |
168,225 |
|
|
$ |
94,790 |
|
|
$ |
664 |
|
|
$ |
263,679 |
|
% of total revenue |
|
63.8 |
% |
|
35.9 |
% |
|
0.3 |
% |
|
100.0 |
% |
Net income (loss)
The following tables present our net income (loss) by segment
(dollars in thousands):
|
|
Three Months Ended March 31, 2019 (Successor
Company) |
|
|
CumulusRadio StationGroup |
|
WestwoodOne |
|
Corporateand Other |
|
Consolidated |
Net income (loss) |
|
$ |
25,843 |
|
|
$ |
9,563 |
|
|
$ |
(34,955 |
) |
|
$ |
451 |
|
$ change from three months
ended March 31, 2018 |
|
$ |
(2,965 |
) |
|
$ |
3,741 |
|
|
$ |
4,676 |
|
|
$ |
5,452 |
|
% change from three months
ended March 31, 2018 |
|
N/A |
|
N/A |
|
N/A |
|
N/A |
|
|
Three Months Ended March 31, 2018 (Predecessor
Company) |
|
|
CumulusRadio StationGroup |
|
WestwoodOne |
|
Corporateand Other |
|
Consolidated |
Net income (loss) |
|
$ |
28,808 |
|
|
$ |
5,822 |
|
|
$ |
(39,631 |
) |
|
$ |
(5,001 |
) |
Adjusted EBITDA
The following tables present our Adjusted EBITDA by segment
(dollars in thousands):
|
|
Three Months Ended March 31, 2019 (Successor
Company) |
|
|
CumulusRadio StationGroup |
|
WestwoodOne |
|
Corporateand Other |
|
Consolidated |
Adjusted EBITDA |
|
$ |
34,391 |
|
|
$ |
15,950 |
|
|
$ |
(8,537 |
) |
|
$ |
41,804 |
|
$ change from three months ended
March 31, 2018 |
|
$ |
(1,795 |
) |
|
$ |
3,294 |
|
|
$ |
36 |
|
|
$ |
1,535 |
|
% change from three months ended
March 31, 2018 |
|
(5.0 |
)% |
|
26.0 |
% |
|
(0.4 |
)% |
|
3.8 |
% |
|
|
Three Months Ended March 31, 2018 (Predecessor
Company) |
|
|
CumulusRadio StationGroup |
|
WestwoodOne |
|
Corporateand Other |
|
Consolidated |
Adjusted EBITDA |
|
$ |
36,186 |
|
|
$ |
12,656 |
|
|
$ |
(8,573 |
) |
|
$ |
40,269 |
|
Earnings Conference Call DetailsThe Company
will host a conference call today at 4:30 PM EDT to discuss its
first quarter 2019 operating results. A link to the webcast of the
conference call will be available on the investor section of the
Company’s website (www.cumulusmedia.com/investors/). The conference
call dial-in number for domestic callers is 877-830-7699, and
international callers should dial 248-847-2515 for call access. If
prompted, the conference ID number is 1496528. Please call five to
ten minutes in advance to ensure that you are connected prior to
the call.
Following completion of the call, a telephonic replay can be
accessed until 11:59 PM EDT on June 9, 2019, by dialing
855-859-2056 or 404-537-3406 and using the replay code 1496528.
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 our future operating,
financial, and strategic performance. Any such forward-looking
statements are not guarantees of future performance and 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 related to our recently completed financial
restructuring and other risk factors described from time to time in
our filings with the Securities and Exchange Commission. 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 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 434
owned-and-operated stations broadcasting in 87 US media markets
(including eight of the top 10), approximately 8,000 broadcast
radio stations affiliated with its Westwood One network and
numerous digital channels. Together, the Cumulus Radio Station
Group and Westwood One platforms make CUMULUS MEDIA one of the few
media companies that can provide advertisers with national reach
and local impact. The Cumulus Radio Station Group and Westwood One
are 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, and more. Additionally, the Company 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.cumulusmedia.com.
For further information, please
contact:Cumulus Media Inc.Investor
RelationsIR@cumulus.com404-260-6600
CUMULUS MEDIA
INC.Unaudited Condensed Consolidated Statements of
Operations(Dollars in thousands)
|
SuccessorCompany |
|
|
PredecessorCompany |
|
Three MonthsEnded March 31,2019 |
|
|
Three MonthsEnded March 31,2018 |
Net revenue |
$ |
267,496 |
|
|
|
$ |
263,679 |
|
Operating expenses: |
|
|
|
|
Content costs |
103,752 |
|
|
|
102,866 |
|
Selling, general and administrative expenses |
113,503 |
|
|
|
112,083 |
|
Depreciation and amortization |
14,590 |
|
|
|
11,981 |
|
Local marketing agreement fees |
1,043 |
|
|
|
1,107 |
|
Corporate expenses |
8,532 |
|
|
|
8,600 |
|
Stock-based compensation expense |
1,208 |
|
|
|
166 |
|
Acquisition-related restructuring costs |
2,777 |
|
|
|
1,721 |
|
Loss on sale of assets or stations |
26 |
|
|
|
11 |
|
Total operating expenses |
245,431 |
|
|
|
238,535 |
|
Operating income |
22,065 |
|
|
|
25,144 |
|
Non-operating (expense)
income: |
|
|
|
|
Reorganization items, net |
— |
|
|
|
(30,167 |
) |
Interest expense |
(22,156 |
) |
|
|
(128 |
) |
Interest income |
4 |
|
|
|
29 |
|
Gain on early extinguishment of debt |
381 |
|
|
|
— |
|
Other (expense) income, net |
(28 |
) |
|
|
3 |
|
Total non-operating expense, net |
(21,799 |
) |
|
|
(30,263 |
) |
Income (loss) before income tax
benefit |
266 |
|
|
|
(5,119 |
) |
Income tax benefit |
185 |
|
|
|
118 |
|
Net income (loss) |
$ |
451 |
|
|
|
$ |
(5,001 |
) |
Non-GAAP Financial MeasureFrom 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. Consolidated adjusted earnings
before interest, taxes, depreciation, and amortization ("Adjusted
EBITDA") and segment Adjusted EBITDA are the financial metrics by
which management and the chief operating decision maker allocate
resources of the Company and analyze the performance of the Company
as a whole and each of our reportable segments. 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 and acquisitions. In addition, consolidated Adjusted EBITDA
is a key metric for purposes of calculating and determining our
compliance with certain covenants in our credit agreement.
In determining Adjusted EBITDA, the Company excludes from net
income items not related to core operations and those that are
non-cash including: interest, taxes, depreciation, amortization,
stock-based compensation expense, gain or loss on the exchange,
sale, or disposal of any assets or stations, early extinguishment
of debt, local marketing agreement fees, expenses relating to
acquisitions, divestitures, restructuring costs, reorganization
items and non-cash impairments of assets, if any.
Management believes that Adjusted EBITDA, although not a measure
that is calculated in accordance with GAAP, is commonly employed by
the investment community as a measure for determining the market
value of a media company and comparing the operational and
financial performance among media companies. Management has also
observed that Adjusted EBITDA is routinely utilized to evaluate and
negotiate the potential purchase price for media companies. 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 (loss), 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 segment and consolidated Adjusted EBITDA
for the three months ended March 31, 2019 (Successor Company) and
2018 (Predecessor Company) (dollars in thousands):
|
|
Three Months Ended March 31, 2019 (Successor
Company) |
|
|
CumulusRadio StationGroup |
|
Westwood One |
|
Corporateand Other |
|
Consolidated |
GAAP net income (loss) |
|
$ |
25,843 |
|
|
$ |
9,563 |
|
|
$ |
(34,955 |
) |
|
$ |
451 |
|
Income tax benefit |
|
— |
|
|
— |
|
|
(185 |
) |
|
(185 |
) |
Non-operating expense, including net interest expense |
|
186 |
|
|
142 |
|
|
21,852 |
|
|
22,180 |
|
Local marketing agreement fees |
|
1,043 |
|
|
— |
|
|
— |
|
|
1,043 |
|
Depreciation and amortization |
|
7,305 |
|
|
6,195 |
|
|
1,090 |
|
|
14,590 |
|
Stock-based compensation expense |
|
— |
|
|
— |
|
|
1,208 |
|
|
1,208 |
|
Loss on sale of assets or stations |
|
14 |
|
|
— |
|
|
12 |
|
|
26 |
|
Acquisition-related and restructuring costs |
|
— |
|
|
50 |
|
|
2,727 |
|
|
2,777 |
|
Franchise and state taxes |
|
— |
|
|
— |
|
|
95 |
|
|
95 |
|
Gain on early extinguishment of debt |
|
— |
|
|
— |
|
|
(381 |
) |
|
(381 |
) |
Adjusted EBITDA |
|
$ |
34,391 |
|
|
$ |
15,950 |
|
|
$ |
(8,537 |
) |
|
$ |
41,804 |
|
|
|
Three Months Ended March 31, 2018 (Predecessor
Company) |
|
|
CumulusRadio StationGroup |
|
Westwood One |
|
Corporateand Other |
|
Consolidated |
GAAP net income (loss) |
|
$ |
28,808 |
|
|
$ |
5,822 |
|
|
$ |
(39,631 |
) |
|
$ |
(5,001 |
) |
Income tax benefit |
|
— |
|
|
— |
|
|
(118 |
) |
|
(118 |
) |
Non-operating (income) expense, including net interest (income)
expense |
|
(1 |
) |
|
127 |
|
|
(30 |
) |
|
96 |
|
Local marketing agreement fees |
|
1,107 |
|
|
— |
|
|
— |
|
|
1,107 |
|
Depreciation and amortization |
|
6,141 |
|
|
5,478 |
|
|
362 |
|
|
11,981 |
|
Stock-based compensation expense |
|
— |
|
|
— |
|
|
166 |
|
|
166 |
|
Loss on sale of assets or stations |
|
11 |
|
|
— |
|
|
— |
|
|
11 |
|
Reorganization items, net |
|
— |
|
|
181 |
|
|
29,986 |
|
|
30,167 |
|
Franchise and state taxes |
|
— |
|
|
— |
|
|
139 |
|
|
139 |
|
Acquisition-related and restructuring costs |
|
120 |
|
|
1,048 |
|
|
553 |
|
|
1,721 |
|
Adjusted EBITDA |
|
$ |
36,186 |
|
|
$ |
12,656 |
|
|
$ |
(8,573 |
) |
|
$ |
40,269 |
|
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