LBI Media Holdings, Inc. Reports Second Quarter 2007 Results Second Quarter 2007 Net Revenues Increase 10.9% and Adjusted EBITDA Grew

19.8%



    BURBANK, Calif., Aug. 14 /PRNewswire/ -- LBI Media Holdings, Inc. (the
 "Company") announced its financial results today for the three and six
 months ended June 30, 2007.
     Results for the Three Months Ended June 30, 2007
     For the quarter ended June 30, 2007, net revenues increased by $3.2
 million, or 11.0%, to $32.5 million, from $29.3 million for the same period
 in 2006. This increase was primarily attributable to increased advertising
 revenue from our Los Angeles and Dallas radio markets. In Dallas, we
 operate an existing FM radio station and five other radio stations that we
 recently acquired. Our television segment revenues also contributed an
 increase of $0.1 million in net revenues for the three months ended June
 30, 2007. Operating expenses decreased by $0.8 million, or 5.0%, to $16.2
 million for the three months ended June 30, 2007 from $17.0 million for the
 same period in 2006. This decrease in operating expenses was primarily
 attributable to a $2.7 million decrease in deferred compensation expense
 and a $1.6 million decrease in an impairment charge related to one of our
 broadcast licenses that we recorded in the second quarter of 2006, offset
 by increases in selling, general and administrative expenses, programming
 expenses and depreciation and amortization. Adjusted EBITDA(1) increased by
 $3.1 million, or 19.8%, to $18.6 million for the three months ended June
 30, 2007 as compared to $15.5 million for the same period in 2006. Our
 Adjusted EBITDA margin(2) increased to 57.1% in the second quarter of 2007
 from 52.9% in the same period in 2006.
     We recognized net income of $6.9 million for the three months ended
 June 30, 2007, as compared to net income of $4.5 million for the same
 period of 2006, an increase of $2.4 million, or 55.5%. This increase was
 primarily attributable to a credit to deferred compensation expense related
 to a payment made in August 2007.
     Radio division net revenues increased by $3.1 million, or 22.1%, to
 $17.1 million for the quarter ended June 30, 2007 from $14.0 million for
 the same quarter last year. This increase was attributable to revenue
 growth at our Los Angeles radio stations and revenue generated by our new
 and existing Dallas radio stations. Operating expenses for our radio
 division decreased by $0.7 million, or 11.1%, to $5.4 million for the three
 months ended June 30, 2007, from $6.1 million for the same period in 2006.
 Decreases in operating expenses were attributable primarily to a credit to
 deferred compensation expense related to a payment made in August 2007,
 offset by increased expenses associated with our newly acquired Dallas
 radio stations. Adjusted EBITDA increased by $4.2 million, or 50.1%, to
 $12.7 million for the three months ended June 30, 2007 as compared to
 Adjusted EBITDA of $8.5 million for the same period in 2006. Our radio
 division's Adjusted EBITDA margin increased to 74.6% in the second quarter
 of 2007 from 60.7% in the same period in 2006.
     Television division net revenues increased by $0.1 million, or 0.9%, to
 $15.4 million for the three months ended June 30, 2007, from $15.3 million
 for the same period in 2006. This increase was primarily attributable to
 increased advertising revenue at our Texas television stations. Operating
 expenses for our television division decreased by $0.1 million, or 1.6%, to
 $10.8 million for the three months ended June 30, 2007, from $10.9 million
 for the same period in 2006. This decrease in operating expenses was
 primarily attributable to a $1.6 million decrease in an impairment charge
 related to one of our broadcast licenses, offset by increases in selling,
 general and administrative expenses and programming expenses. Adjusted
 EBITDA decreased by $1.2 million, or 16.9%, to $5.8 million for the quarter
 ended June 30, 2007, from $7.0 million for the same quarter last year. Our
 television division's Adjusted EBITDA margin decreased to 37.6% in the
 second quarter of 2007 from 45.7% for the same period in 2006.
     Results for the Six Months Ended June 30, 2007
     Net revenues increased $6.2 million or 11.9% to $57.7 million from
 $51.5 million for the six months ended June 30, 2007 compared to the same
 period in 2006. This increase was primarily attributable to increased
 advertising revenue from our Los Angeles and Dallas radio markets and
 augmented by increases in our television segment. Operating expenses
 increased by $1.1 million, or 3.5%, to $33.0 million for the six months
 ended June 30, 2007, from $31.9 million for the same period in 2006. This
 increase was primarily attributable to increases in selling, general and
 administrative as well as increases in programming expenses related to
 additional production of in-house television programs and depreciation and
 amortization, partially offset by decreases in deferred compensation
 expense and a decrease in impairment charges related to one of our
 broadcast licenses that we recorded in the second quarter of 2006. Adjusted
 EBITDA increased by $4.7 million, or 19.1%, to $29.2 million for the six
 months ended June 30, 2007 as compared to $24.5 million for the same period
 in 2006. Our Adjusted EBITDA margin increased to 50.6% for the six months
 ended June 30, 2007 from 47.5% in the same period in 2006.
     We recognized a net loss of $41.1 million for the six months ended June
 30, 2007, as compared to net income of $4.2 million for the same period of
 2006, a decrease of $45.3 million. This change was primarily attributable
 to the one-time non-cash charge of $46.9 million to adjust our deferred tax
 accounts in the first quarter of 2007 as a result of the sale of Class A
 common stock of our parent, Liberman Broadcasting, Inc., in March 2007.
     Radio division net revenues increased by $5.3 million, or 22.4%, to
 $29.1 million for the six months ended June 30, 2007, from $23.8 million
 for the six months ended June 30, 2006. This increase was primarily
 attributable to revenue increases at our new and existing Dallas radio
 stations and augmented by an increase in revenues at our Los Angeles radio
 stations. Operating expenses for our radio division decreased by $0.1
 million, or 0.7%, to $12.0 million for the six months ended June 30, 2007,
 from $12.1 million for the same period in 2006. Decreases in operating
 expenses were attributable primarily to credits to deferred compensation
 expense related to payments made in March and August 2007, offset by
 increased expenses associated with the Dallas stations we acquired in
 November 2006. Adjusted EBITDA for our radio division increased by $6.5
 million, or 50.0%, to $19.4 million for the six months ended June 30, 2007
 as compared to $12.9 million for the same period in 2006. Our radio
 division's Adjusted EBITDA margin increased to 66.5% for the six months
 ended June 30, 2007 from 54.3% in the same period in 2006.
     Television division net revenues increased by $0.8 million, or 2.8%, to
 $28.5 million for the six months ended June 30, 2007, from $27.7 million
 for the same period in 2006. This increase was primarily attributable to
 increased advertising revenue in our Texas markets. Operating expenses for
 our television division increased by $1.2 million, or 6.1%, to $21.0
 million for the six months ended June 30, 2007, from $19.8 million for the
 same period in 2006. This increase was primarily attributable to increases
 in selling, general and administrative as well as increases in programming
 expenses related to additional production of in-house television programs.
 Adjusted EBITDA for our television division decreased by $1.8 million, or
 15.4% to $9.8 million for the six months ended June 30, 2007, from $11.6
 million for the same period in 2006. Our television division's Adjusted
 EBITDA margin decreased to 34.3% for the six months ended June 30, 2007
 from 41.7% in the same period in 2006.
     Commenting on our results, Lenard Liberman, our Executive Vice
 President, said, "2007 has proven to be a very exciting year for us. We
 have successfully launched our five new radio station formats in Dallas and
 in a very short period of time, we have achieved impressive ratings and
 revenue growth. In our television group, we have successfully launched new
 programs that have improved our ratings and rank position in our markets.
 In the most recent July sweeps period, KRCA in Los Angeles ranks number two
 in prime time in the male 18-34 and 18-49 demographics. At our Los Angeles
 radio stations, we have achieved record ratings for our company with KBUE
 ranking number two in the 18-34 and 18-49 demographics. This outstanding
 performance by our stations should result in continued increased revenues
 as the year progresses. We were also very fortunate to have completed our
 debt financings in the third quarter of this year which provides our
 company with significant acquisition capacity and a flexible financial
 structure. Soon, we will be entering into two new markets with our
 announced acquisitions of KPNZ-TV in Salt Lake City, Utah and KWIE-FM in
 Riverside/San Bernardino, California, which will further expand our
 interests into two high growth Mexican-based Hispanic markets. We expect to
 close these acquisitions in the late third or fourth quarter."
     Information for Holders of LBI Media's 8 1/2% Senior Subordinated Notes
 due 2017
     Results for LBI Media, Inc.'s three and six months ended June 30, 2007
 will be posted on our website at http://www.lbimedia.com/investors. Holders
 and beneficial owners of LBI Media, Inc.'s 81/2% Senior Subordinated Notes
 due 2017 may access this information by contacting Jose Liberman at (818)
 563-5722 to receive a temporary username and password.
     Second Quarter 2007 Conference Call
     We will host a conference call to discuss our financial results for the
 second quarter of 2007 on Tuesday, August 14, 2007 at 5:00 PM Eastern Time.
 Interested parties may participate in the conference call by dialing (800)
 310-1961 five minutes prior to the scheduled start time of the call and
 asking for the "LBI Media Holdings, Inc. Second Quarter 2007 Results
 Conference Call." The conference call will be recorded and made available
 for replay through Friday, August 17. Investors may listen to the replay of
 the call by dialing (888) 203-1112 then entering the passcode 2085642.
     About LBI Media Holdings, Inc.
     We are one of the largest owners and operators of Spanish-language
 radio and television stations in the United States, based on revenues and
 number of stations. We own twenty-one radio stations and four television
 stations serving the Los Angeles, CA, Houston, TX, Dallas-Ft. Worth, TX and
 San Diego, CA markets. We also owns three television production facilities.
     Forward Looking Statements
     This news announcement contains certain forward-looking statements
 within the meaning of the U.S. securities laws. These statements are based
 upon current expectations and involve certain risks and uncertainties,
 including those related to the expected future operating performance of our
 radio stations, television stations and studio operations. Forward-looking
 statements include but are not limited to information preceded by, or that
 include the words, "believes", "expects", "prospects", "pacings",
 "anticipates", "could", "estimates", "forecasts" or similar expressions.
 The reader should note that these statements may be impacted by several
 factors, including economic changes, regulatory changes, increased
 competition, the timing of announced acquisitions or station upgrades,
 changes in the broadcasting industry generally, and changes in interest
 rates. Accordingly, our actual performance and results may differ from
 those anticipated in the forward-looking statements. Please see our recent
 public filings for information about these and other risks that may affect
 us. We undertake no obligation to update or revise the information
 contained herein because of new information, future events or otherwise.
     (1) We define Adjusted EBITDA as net income (loss) plus income tax expense
         (benefit), gain (loss) on sale of property and equipment, gain (loss)
         on sale of investments, net interest expense, interest rate swap
         expense, impairment of broadcast licenses, and depreciation and
         amortization. Management considers this measure an important indicator
         of our liquidity relating to our operations because it eliminates the
         effects of certain noncash items and our capital structure. This
         measure should be considered in addition to, but not as a substitute
         for or superior to, other measures of liquidity and financial
         performance prepared in accordance with U.S. generally accepted
         accounting principles, such as cash flows from operating activities,
         operating income and net income. In addition, our definition of
         Adjusted EBITDA may differ from those of many companies reporting
         similarly named measures.
 
         In determining our Adjusted EBITDA in past years, we treated deferred
         compensation expense (benefit) as a noncash item, because we had the
         option and the intention to pay such amounts in the common stock of
         our indirect parent after our indirect parent's initial public
         offering. Our first payment became due in 2006 and we have made
         additional payments in 2007. We have determined that we can no longer
         meet the conditions necessary to pay the deferred compensation in
         stock. Accordingly, we have settled our deferred compensation amounts
         in cash. We have presented prior periods' Adjusted EBITDA to conform
         to this current treatment. As a result, Adjusted EBITDA for prior
         periods may appear as a different amount from what we have reported in
         prior periods.
 
     (2) We define Adjusted EBITDA margin as Adjusted EBITDA divided by net
         revenues.
 
 
 
     Results of Operations:
 
                            LBI MEDIA HOLDINGS, INC.
           UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                 (In thousands)
 
                                         Three Months Ended  Six Months Ended
                                               June 30,          June 30,
                                            2007    2006      2007     2006
 
     Net revenues                         $32,515  $29,291   $57,660  $51,533
     Operating expenses:
       Program and technical, exclusive
        of deferred compensation expense
        (benefit) of $0 and $(94) for
        the three months ended June 30,
        2007 and 2006, respectively,
        and $0 and $(15) for the six
        months ended June 30, 2007 and
        2006, respectively, and
        depreciation and amortization
        shown below                         5,855    4,937    11,469    9,438
       Promotional, exclusive of
        depreciation and amortization
        shown below                           719      501     1,108      838
       Selling, general and administrative,
        exclusive of deferred compensation
        expense (benefit) of $(2,820) and
        $(67) for the three months ended
        June 30, 2007 and 2006,
        respectively, and $(3,952) and
        $129 for the six months ended
        June 30, 2007 and 2006,
        respectively, and depreciation
        and amortization shown below       10,207    8,527    19,869   16,654
       Deferred compensation expense
        (benefit)                          (2,820)    (161)   (3,952)     114
       Depreciation and amortization        2,227    1,632     4,527    3,263
       Impairment of broadcast licenses         -    1,600         -    1,600
     Total operating expenses              16,188   17,036    33,021   31,907
     Operating income                      16,327   12,255    24,639   19,626
     Interest expense, net of amount
      capitalized                          (8,494)  (7,703)  (17,650) (15,304)
     Interest rate swap expense             1,407        -     1,127        -
     Interest and other income                 66       28       105       58
     Income before income taxes             9,306    4,580     8,221    4,380
     (Provision) benefit for income taxes  (2,377)    (125)  (49,318)    (175)
     Net income                            $6,929   $4,455  $(41,097)  $4,205
 
     Adjusted EBITDA (3)                  $18,554  $15,487   $29,166  $24,489
 
     Adjusted EBITDA Margin (4)              57.1%    52.9%     50.6%    47.5%
 
 
     (3) Refer to footnote (1)
     (4) Refer to footnote (2)
     The table set forth below reconciles net cash provided by operating
 activities, calculated and presented in accordance with U.S. generally
 accepted accounting principles, to Adjusted EBITDA:
                                           Three Months Ended  Six Months Ended
                                                June 30,          June 30,
                                             2007     2006     2007     2006
                                                      (In thousands)
     Net cash provided by
     operating activities                   $6,247   $8,093   $5,632   $8,794
     Add:
       Income tax expense                    2,377      125   49,318      175
       Interest expense and other income,
        net                                  8,428    7,675   17,545   15,246
     Less:
       Amortization of deferred financing
        costs                                 (301)    (247)    (601)    (496)
 
       Accretion on senior discount
        notes                               (1,589)  (1,427)  (3,108)  (2,792)
       Provision for doubtful accounts        (300)    (276)    (521)    (483)
       Deferred compensation benefit
        (expense)                            2,820      161    3,952     (114)
     Changes in operating assets and
      liabilities:
       Accounts receivable                   5,080    4,677    2,626    3,253
       Deferred compensation payment             -        -    1,374        -
       Program rights                         (144)    (208)    (322)    (424)
       Amounts due from related parties         (6)      52      (15)     138
       Prepaid expenses and other current
        assets                                (156)    (193)    (194)     (55)
       Employee advances                       (13)     394       (8)     327
       Accounts payable and accrued
        expenses                               565      687    1,321    1,163
       Accrued interest                     (2,088)  (3,996)   1,383     (182)
       Deferred taxes payable               (3,024)       -  (49,082)       -
       Other assets and liabilities            658      (30)    (134)     (61)
     Adjusted EBITDA                       $18,554  $15,487  $29,166  $24,489
 
 
 
     The following is a reconciliation of operating income to Adjusted EBITDA
 for our radio division:
 
                                         Three Months Ended  Six Months Ended
                                              June 30,           June 30,
                                           2007     2006      2007     2006
                                                    (In thousands)
 
     Radio division operating income     $11,662   $7,893   $17,151  $11,727
     Depreciation and amortization         1,079      598     2,231    1,196
     Radio division Adjusted EBITDA      $12,741   $8,491   $19,382   $12,923
 
 
 
     The following is a reconciliation of operating income to Adjusted EBITDA
 for our television division:
 
                                          Three Months Ended   Six Months Ended
                                               June 30,          June 30,
                                            2007     2006     2007      2006
                                                     (In thousands)
 
     Television division operating income  $4,665   $4,362   $7,488    $7,899
       Depreciation and amortization        1,148    1,034    2,296     2,067
       Impairment of broadcast licenses        -     1,600        -     1,600
     Television division Adjusted EBITDA   $5,813   $6,996   $9,784   $11,566
 
 

SOURCE LBI Media Holdings, Inc.

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