Emmis Second Quarter Radio Revenues Up 3.5%; Stations Outperform Markets Again

Oct 10, 2013, 06:00 ET from Emmis Communications Corporation

INDIANAPOLIS, Oct. 10, 2013 /PRNewswire/ -- Emmis Communications Corporation (NASDAQ: EMMS) today announced results for its second fiscal quarter ending August 31, 2013.

Emmis' radio net revenues for the second fiscal quarter were up 3.5%, while the markets in which Emmis operates were up 3.3% during the quarter.  Publishing net revenues were up 5.7% for the quarter.  On a consolidated basis, total revenues for the quarter were $55.0 million, compared to $52.9 million in the same quarter of the prior year.  

Diluted net income per common share from continuing operations for the quarter was $0.05, compared to a diluted net loss per common share from continuing operations of ($0.02) for the same quarter of the prior year.

For the second fiscal quarter, operating income decreased to $5.7 million from $7.6 million for the same quarter of the prior year due to higher noncash compensation expense, principally due to Emmis' 2012 Retention Trust, and higher legal costs related to the company's Hungarian ICSID claim.  Emmis' station operating income for the second fiscal quarter was flat compared to the same quarter of the prior year at $13.2 million.

"It was an eventful quarter at Emmis as we heralded the successful launch of NextRadio and continued to outperform our radio markets," said Jeff Smulyan, President & CEO of Emmis. "Our ability to innovate on behalf of the radio industry, coupled with our focus on delivering successful near-term results, are a testament to the impact our high performing Emmis team can deliver."

Emmis has included supplemental station operating expenses and certain other financial data on its website, www.emmis.com under the "Investors" tab.

Emmis generally evaluates the performance of its operating entities based on station operating income. Management believes that station operating income is useful to investors because it provides a meaningful comparison of operating performance between companies in the industry and serves as an indicator of the market value of a group of stations or publishing entities. Station operating income is generally recognized by the broadcast and publishing industries as a measure of performance and is used by analysts who report on the performance of broadcasting and publishing groups. Station operating income does not take into account Emmis' debt service requirements and other commitments, and, accordingly, station operating income is not necessarily indicative of amounts that may be available for dividends, reinvestment in Emmis' business or other discretionary uses.

Station operating income is not a measure of liquidity or of performance, in accordance with accounting principles generally accepted in the United States, and should be viewed as a supplement to, and not a substitute for, our results of operations presented on the basis of accounting principles generally accepted in the United States. Operating Income is the most directly comparable financial measure in accordance with accounting principles generally accepted in the United States. 

Moreover, station operating income is not a standardized measure and may be calculated in a number of ways. Emmis defines station operating income as revenues net of agency commissions and station operating expenses, excluding depreciation, amortization and non-cash compensation.  A reconciliation of station operating income to operating income is attached to this press release. 

The information in this news release is being widely disseminated in accordance with the Securities & Exchange Commission's Regulation FD.

There is an earnings call this morning with Emmis executives at 9 am Eastern.  To access the second-quarter earnings conference call, please dial in at 1-517-623-4891.  Please submit questions prior or during the call to ir@emmis.com.  A playback of the call will be available until 6 p.m. on Thursday, Oct. 24 by dialing 1-402-220-4182.

Emmis Communications – Great Media, Great People, Great Service® About Emmis Communications Emmis Communications Corporation is a diversified media company, principally focused on radio broadcasting. Emmis operates the 10th largest publicly traded radio portfolio in the United States based on total listeners.  Emmis owns 18 FM and 3 AM radio stations in New York, Los Angeles, St. Louis, Austin (Emmis has a 50.1% controlling interest in Emmis' radio stations located there), Indianapolis and Terre Haute, IN.  One of our FM radio stations in New York is operated pursuant to a Local Marketing Agreement ("LMA") whereby a third party provides the programming for the station and sells all advertising within that programming.

Note: Certain statements included in this press release which are not statements of historical fact, including but not limited to those identified with the words "expect," "will" or "look" are intended to be, and are, by this Note, identified as "forward-looking statements," as defined in the Securities and Exchange Act of 1934, as amended. Such statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from any future result, performance or achievement expressed or implied by such forward-looking statement. Such factors include, among others:

  • general economic and business conditions;
  • fluctuations in the demand for advertising and demand for different types of advertising media;
  • our ability to service our outstanding debt;
  • increased competition in our markets and the broadcasting industry;
  • our ability to attract and secure programming, on-air talent, writers and photographers;
  • inability to obtain (or to obtain timely) necessary approvals for purchase or sale transactions or to complete the transactions for other reasons
  • generally beyond our control;
  • increases in the costs of programming, including on-air talent;
  • inability to grow through suitable acquisitions or to consummate dispositions;
  • changes in audience measurement systems
  • new or changing regulations of the Federal Communications Commission or other governmental agencies;
  • competition from new or different technologies;
  • war, terrorist acts or political instability; and
  • other factors mentioned in documents filed by the Company with the Securities and Exchange Commission.

Emmis does not undertake any obligation to publicly update or revise any forward-looking statements because of new information, future events or otherwise

EMMIS COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED FINANCIAL DATA

(Unaudited, amounts in thousands, except per share data)

Three months ended August 31,

Six months ended August 31,

2013

2012

2013

2012

OPERATING DATA:

  Net revenues:

    Radio

$                     41,259

$                    39,964

$                     78,185

$                    74,840

    Publishing

13,708

12,965

27,368

27,057

      Total net revenues

54,967

52,929

105,553

101,897

  Station operating expenses excluding

   depreciation and amortization expense:

    Radio

28,000

25,988

50,911

52,308

    Publishing

13,938

13,790

28,739

28,042

      Total station operating expenses excluding 

          depreciation and amortization expense 

41,938

39,778

79,650

80,350

  Corporate expenses excluding depreciation 

       and amortization expense

5,070

4,161

9,470

9,133

  Hungary license litigation and related expenses

1,043

210

1,295

414

  Depreciation and amortization

1,213

1,169

2,389

2,294

  Impairment loss

-

-

-

10,971

  Gain on sale of assets

(1)

(6)

(1)

(10,006)

  Operating income

5,704

7,617

12,750

8,741

  Interest expense

(1,808)

(6,878)

(3,729)

(12,645)

  Loss on debt extinguishment 

-

(601)

-

(1,085)

  Other income (expense), net

33

(215)

40

(17)

  Income (loss) before income taxes and

   discontinued operations

3,929

(77)

9,061

(5,006)

  Provision (benefit) for income taxes

4

(1,509)

179

(5,924)

  Income from continuing operations

3,925

1,432

8,882

918

  Income from discontinued operations, net of tax

-

38,776

-

36,417

  Consolidated net income

3,925

40,208

8,882

37,335

  Net income attributable to noncontrolling interests

1,354

1,217

2,835

2,479

  Net income attributable to the Company

2,571

38,991

6,047

34,856

  Gain on extinguishment of preferred stock

76

-

325

-

  Preferred stock dividends

-

(910)

-

(1,806)

  Net income attributable to common shareholders

$                       2,647

$                    38,081

$                       6,372

$                    33,050

  Amounts attributable to common shareholders for basic earnings per share:

    Continuing operations

2,647

(695)

6,372

(3,367)

    Discontinued operations

-

38,776

-

36,417

      Net income attributable to common shareholders

2,647

38,081

6,372

33,050

  Amounts attributable to common shareholders for diluted earnings per share:

    Continuing operations

2,571

(695)

6,047

(3,367)

    Discontinued operations

-

38,776

-

36,417

      Net income attributable to common shareholders

2,571

38,081

6,047

33,050

  Basic net income (loss) per common share:

    Continuing operations

$                          0.06

$                       (0.02)

$                          0.15

$                       (0.09)

    Discontinued operations

-

1.00

-

0.94

      Net income attributable to common shareholders

$                          0.06

$                        0.98

$                          0.15

$                        0.85

  Diluted net income (loss) per common share:

    Continuing operations

$                          0.05

$                       (0.02)

$                          0.13

$                       (0.09)

    Discontinued operations

-

1.00

-

0.94

      Net income attributable to common shareholders

$                          0.05

$                        0.98

$                          0.13

$                        0.85

  Weighted average shares outstanding:

      Basic

41,451

38,859

41,313

38,819

      Diluted

46,937

38,859

46,361

38,819

OTHER DATA:

  Station operating income (See below)

13,199

13,237

26,074

21,580

  (Refund from) cash paid for income taxes, net

(138)

537

(804)

731

  Cash paid for interest

1,586

7,681

3,285

15,377

  Capital expenditures

841

206

1,857

956

 Noncash compensation by segment:

           Radio

$                           811

$                         190

$                           980

$                         290

           Publishing

402

106

486

157

           Corporate

1,206

269

1,616

507

                  Total

$                       2,419

$                         565

$                       3,082

$                         954

COMPUTATION OF STATION OPERATING INCOME:

  Operating income

$                       5,704

$                      7,617

$                     12,750

$                      8,741

  Plus:  Depreciation and amortization

1,213

1,169

2,389

2,294

  Plus:  Corporate expenses

5,070

4,161

9,470

9,133

  Plus:  Station noncash compensation

1,213

296

1,466

447

  Plus:  Impairment loss

-

-

-

10,971

  Less:  Gain on sale of assets

(1)

(6)

(1)

(10,006)

  Station operating income

$                     13,199

$                    13,237

$                     26,074

$                    21,580

SELECTED BALANCE SHEET INFORMATION:

August 31, 2013

February 28, 2013

Total Cash and Cash Equivalents

$                       6,821

$                      8,735

Credit Agreement Debt

$                     63,000

$                    67,000

98.7FM Nonrecourse Debt

$                     77,053

$                    79,068

 

SOURCE Emmis Communications Corporation



RELATED LINKS

http://www.emmis.com