Adjusted EBITDA Increased 173%
Audacy, Inc. (OTC: AUDAQ) today reported financial results for
the quarter ended March 31, 2024.
David J. Field, Chairman, President and Chief Executive Officer,
stated: “Audacy delivered a solid start to 2024 with Q1 EBITDA
increasing 173% vs the prior year. Second-quarter revenues are
currently pacing up low-single digits, and we expect another
quarter of substantial EBITDA growth, enhanced by our continuing
work on expense reductions.
Our improving results are predominantly attributable to a
significant acceleration in digital revenue growth, continuing
meaningful revenue share gains, and declining expenses as our
transformational investments bear fruit.
As previously announced, we received court approval of our
consensual pre-packaged Plan of Reorganization, which will reduce
our debt by 80%, and are now awaiting FCC approval to complete the
process. I want to salute our team for their excellent work in
driving financial and operating progress while simultaneously
executing our reorganization plan, all without disruption to
customers, listeners, partners, vendors or our staff.
The Audacy team is very much looking forward to a bright future,
emerging as a scaled leader in the dynamic audio market,
distinguished by our best-in-class balance sheet, our top positions
across the country's largest markets, and our exclusive premium
content highlighted by our unrivaled leadership in sports
audio.”
First Quarter Summary
- Net revenues for the quarter were $261.8 million, up 1%
compared to $259.6 million in the first quarter of 2023
- Total Radio revenues decreased 2% while Digital revenues
increased 10%
- Total operating expenses for the quarter were $262.2 million,
which includes a gain on asset sale of $15.8 million, compared to
$271.8 million in the first quarter of 2023, which included a gain
on sale of $12.4 million and a non-cash impairment loss of $5.1
million
- Cash operating expenses for the quarter were $252.2 million,
down 2% compared to $256.1 million in the first quarter of
2023
- Operating loss for the quarter was $0.4 million, compared to an
operating loss of $12.2 million in the first quarter of 2023
- Adjusted EBITDA for the quarter was $9.6 million, up 173%
compared to $3.5 million in the first quarter of 2023
- As of March 31, 2024, the Company’s liquidity, which includes
restricted cash and the Company’s undrawn Accounts Receivable
Facility capacity, was $131 million
Market Share Highlights
- Audacy’s total revenue market share grew approximately 50 basis
points in the first quarter, with Radio market share increasing by
approximately 70 basis points
- These share gains mark an acceleration from the positive growth
trends in 2023
Second Quarter Pacing
- The second quarter is currently pacing up low single digits.
April was particularly strong, up high single digits, while May is
flat and June is up mid-single digits
- Radio is currently pacing down low single digits for the
quarter and Digital revenue is pacing up high teens
Recent Company Developments
- Maintaining Strong Radio Ratings Growth: With the
release of the winter 2024 PPM market ratings, Audacy logged its
8th consecutive quarter of Y/Y broadcast and digital ratings share
growth in the key A25-54 demographic.
- Streaming Performance: Audacy’s streaming platform
continues to deliver consistent growth in both unique users and
listening time, with Y/Y growth of +14% in unique users and
impression growth of +24% in the quarter, driven by strong growth
in Sports and the Audacy Digital Music Stations. Exclusive Audacy
Check-Ins and artist collaborations in the quarter included The
Black Crowes, Green Day, Mary J. Blige, Billy Joel, Jennifer Lopez,
Gwen Stefani, Kings of Leon, Bon Jovi and Lenny Kravitz.
- Podcasting Update: Audacy extended its partnership with
Amy Poehler’s Paper Kite Productions with the weekly career advice
show Million Dollar Advice. We launched multiple Audacy Originals,
including Who Killed the Video Star, which launched in the top 10
on the Apple Charts and as the #1 TV & Film podcast. Expanding
on our #1 sports podcast network position, we launched Season 2 of
our WNBA podcast Queens of the Court, hosted by Sheryl Swoopes and
Jordan Ligons Robinson, and expanded our hit original show Cash the
Ticket, one of the largest sports betting podcasts in the country,
through a partnership with Fanduel. The quarter also saw two new
launches under our growing TenderfootTV partnership, including
Untraced, which hit #1 on the Apple Charts.
- Technology Update: We continue to invest in modernizing
our Ad Tech Platform solutions to drive sales efficiencies in
support of our Digital business, including more robust business
intelligence, programmatic capabilities and the ability to scale ad
product solutions. We announced two new partnerships: Super Hi-Fi
to upgrade our 700 digital Exclusive Stations and streamline our
programming, production, and broadcasting capabilities, and
ElevenLabs to enhance our production processes, freeing up our
creators to focus on building the exceptional content and
experiences they expect from Audacy.
- Audacy Brand: We launched two sub-brands to deliver
enhanced, differentiated buying propositions to the advertising
community: Audacy Podcasts, retiring Cadence13 and 2400Sports as
standalone brands while retaining Pineapple Street Studios as our
premium production studio; and Audacy Sports, consolidating our
broadcast, digital and podcast assets under one name.
- Restructuring Update: The Company received court
approval of its consensual pre-packaged Plan of Reorganization in
late February. Under the Plan, the company's debt will be reduced
by 80%. The Company is now awaiting FCC approval to complete the
process.
The company will not be holding a conference call regarding the
first quarter earnings release.
About Audacy
Audacy, Inc. is a leading multi-platform audio content and
entertainment company that connects with 200 million consumers.
Powered by its exclusive, premium audio content that includes
unrivaled leadership positions in news and sports radio, Audacy
operates one of the country’s two scaled radio broadcasting groups,
a rapidly growing direct-to-consumer digital audio platform,
multiple audio networks, a major event business and a leading,
award-winning podcast studio. Learn more at www.audacyinc.com,
Facebook, X, LinkedIn and Instagram.
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.
Core Spot Revenues consist of local spot plus national spot
advertising revenues less political spot advertising revenues.
Total Radio Revenues consist of spot revenues plus network
revenues, including political advertising.
Station Expenses consist of station operating expenses excluding
non-cash compensation expenses.
Corporate Expenses consist of corporate general and
administrative expenses excluding non-cash compensation
expenses.
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); refinancing expenses; impairment loss, merger and
acquisition costs, restructuring and integration costs, preferred
stock dividends; COVID-19 related expenses/(recoveries);
non-recurring expenses/recoveries otherwise included in corporate
or station expenses; change in fair value of contingent
consideration; deferred compensation expense/(income); (gain) loss
on early extinguishment of debt; liability management expenses;
reorganization items; and (gain) loss on sale or disposal.
Adjusted Free Cash Flow consists of net income (loss): (i) plus
depreciation and amortization; (gain) loss on sale or disposal;
non-cash compensation expense (which is otherwise included in
station operating expenses and corporate general and administrative
expenses); impairment loss; merger and acquisition costs;
restructuring and integration costs, (gain) loss on early
extinguishment of debt; COVID-19 related expenses/(recoveries);
other expense/(income); non-recurring expenses/recoveries otherwise
included in corporate or station expenses; change in fair value of
contingent consideration; deferred compensation expense/(income);
income from discontinued operations (excluding income taxes or tax
benefit); amortization of deferred financing costs and debt premium
included in interest expense; refinancing expenses; income taxes
(benefit); Adjusted Income Taxes Paid; and Net Capital
Expenditures.
Net Capital Expenditures consist 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.
Non-GAAP Financial Measures
It is important to note that Adjusted EBITDA, 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 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.
Certain adjusted non-GAAP financial measures are presented in
this release. The adjustments include, among other items as defined
above, 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 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. 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
This news announcement contains certain forward-looking
statements within the meaning of the U.S. Private Securities
Litigation Reform Act of 1995. These forward-looking statements,
including statements about market conditions, the Company’s revenue
guidance, and the Company’s ability to capitalize on its growth
opportunities, develop digital demand, enhance its balance sheet
and regain compliance with the NYSE’s minimum price condition, are
based upon current expectations and involve certain risks and
uncertainties. Additional information and key risks applicable to
these statements are described in the Company’s reports on Forms
8-K, 10-Q and 10-K and other filings the Company makes with the
Securities and Exchange Commission. All of the forward-looking
statements in this press release are qualified by these cautionary
statements, and actual results or developments may differ
materially from those in these forward-looking statements. The
Company assumes no obligation to publicly update or revise any
forward-looking statements.
AUDACY,
INC.
FINANCIAL
DATA
(amounts in
thousands, except per share data)
(unaudited)
Three Months Ended
March 31,
2024
2023
STATEMENTS OF
OPERATIONS
Net Revenues
$
261,806
$
259,635
Station Expenses
232,391
233,215
Station Expenses - Non-Cash
Compensation
101
712
Corporate Expenses
22,744
24,120
Corporate Expenses - Non-Cash
Compensation
203
1,178
Depreciation And Amortization
21,910
17,442
Other Expenses
88
110
Impairment Loss
156
5,050
Restructuring Charges
442
2,421
Net Gain On Sale Or Disposal of Assets
(15,804
)
(12,404
)
Total Operating Expenses
262,231
271,844
Operating Income (Loss)
(425
)
(12,209
)
Net Interest Expense
5,366
32,381
Reorganization expenses, Net
26,035
-
Other Income
(25,489
)
-
Loss Before Income Taxes
(6,337
)
(44,590
)
Income Tax Benefit
(4,485
)
(8,689
)
Net Income (Loss)
$
(1,852
)
$
(35,901
)
Net Income (Loss) Per Share - Basic
$
(0.39
)
$
(7.63
)
Net Income (Loss) Per Share - Diluted
$
(0.39
)
$
(7.63
)
Weighted Common Shares Outstanding -
Basic
4,730
4,704
Weighted Common Shares Outstanding -
Diluted
4,730
4,704
SUPPLEMENTAL
BREAKDOWN OF REVENUE BY TYPE
Spot (local and national)
$
153,580
$
159,309
Digital (including podcasting)
62,748
56,925
Network
21,947
19,868
Sponsorships and Events
13,343
12,444
Other
10,188
11,089
$
261,806
$
259,635
Political
$
2,076
$
846
Three Months Ended
March 31,
2024
2023
SUPPLEMENTAL
BREAKDOWN OF REVENUE BY FORMAT
Music
$
130,400
$
128,122
Sports
56,609
53,141
News/Talk
40,034
42,368
Non-format Specific
34,763
36,004
$
261,806
$
259,635
SUPPLEMENTAL
DISCLOSURES OF CASH FLOW INFORMATION
Net Capital Expenditures
$
6,949
$
13,618
Adjusted Income Taxes Paid (Refunded)
$
144
$
239
Reorganization items
$
11,417
$
-
March 31,
December 31,
SELECTED BALANCE
SHEET DATA
2024
2023
Cash, Cash Equivalents and Restricted
Cash
$
105,963
$
72,994
DIP Facility
$
32,000
$
n/a
Senior Debt - Term B-2 Loan (1)
$
632,415
$
632,415
Senior Debt - Revolver (1)
$
220,126
$
220,126
Senior Secured Notes - 2027 (1)
$
460,000
$
460,000
Senior Secured Notes - 2029 (1)
$
540,000
$
540,000
Accounts Receivable Facility
$
75,000
$
75,000
Total Shareholders' Deficit
$
(616,301
)
$
(614,753
)
(1) Debt instrument is recorded in
Liabilities Subject to Compromise for March 31, 2024
OTHER FINANCIAL DATA
Three Months Ended
March 31,
2024
2023
Reconciliation Of
GAAP Net Loss To Adjusted EBITDA and To Adjusted Free Cash
Flow
Net Income (Loss )
$
(1,852
)
$
(35,901
)
Income Tax Benefit
(4,485
)
(8,689
)
Net Interest Expense
5,366
32,381
Corporate Expenses - Non-Cash
Compensation
203
1,178
Station Expenses - Non-Cash
Compensation
101
712
Depreciation And Amortization
21,910
17,442
Other Expenses
88
46
Restructuring Charges
442
2,421
Reorganization Items
26,035
-
COVID-19 Related Expenses
-
91
Non-Recurring Expenses Otherwise Included
in Corporate Expenses
-
39
Liability Management Expenses
2,173
1,146
Impairment Loss
156
5,050
Deferred Compensation Expense
748
-
Other Income
(25,489
)
-
Net Gain On Sale Or Disposal of Assets
(15,804
)
(12,404
)
Adjusted EBITDA
9,592
3,512
Net Interest Expense
(5,366
)
(32,381
)
Deferred Financing Costs Included In
Interest Expense
210
1,264
Amortization Debt Premium Included In
Interest Expense
-
(256
)
Net Capital Expenditures
(6,949
)
(13,618
)
Adjusted Income Taxes (Paid) Refunded
(144
)
(239
)
Adjusted Free Cash Flow
$
(2,657
)
$
(41,718
)
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version on businesswire.com: https://www.businesswire.com/news/home/20240509821543/en/
Pat Cunnane pcunnane@entercom.com