Radio One, Inc. Reports Third Quarter Results

Nov 05, 2015, 06:45 ET from Radio One, Inc.

WASHINGTON, Nov. 5, 2015 /PRNewswire/ -- Radio One, Inc. (NASDAQ: ROIAK and ROIA) today reported its results for the quarter ended September 30, 2015. Net revenue was approximately $115.9 million, an increase of 3.3% from the same period in 2014, reflecting greater advertising demand and an increase in affiliate revenue at our cable television segment.  Station operating income1 was approximately $42.2 million, an increase of 9.2% from the same period in 2014. The Company reported operating income of approximately $7.1 million for the three months ended September 30, 2015, compared to operating income of $19.6 million for the same period in 2014. Net loss was approximately $18.1 million or $0.38 per share compared to $13.2 million or $0.28 per share, for the same period in 2014. 

Alfred C. Liggins, III, Radio One's CEO and President stated, "Continuing strong performances by TV One and Reach Media more than offset the revenue declines from our Radio business. Radio continues to be a challenging business, with the markets in which we operate down 2.2% for the quarter, compared to our –6.6%. We are seeing some signs of stabilization in our Washington DC and Houston clusters, as well as strong performances from Dallas, Philadelphia and St Louis. During the quarter we experienced double-digit ratings growth in 11 of our 15 markets, and our four largest markets showed ratings growth of 15% on average from July to September. This positive ratings momentum should lead to improved monetization in 2016.  Fourth quarter core radio advertising revenues, excluding political advertising, are currently pacing (–8.3%) YTY. We remain focused on correcting our underperforming radio clusters, while delivering increased cash-flow through overall cost containment, and revenue growth in the cable television business. I am excited that David Kantor has accepted the role as CEO of our radio platform, including our local stations, network and syndication business. Bringing together all of our radio assets under one leadership structure will enhance our ability to compete and transform our business for the future." 

 

RESULTS OF OPERATIONS

Three Months Ended September 30, 

Nine Months Ended September 30, 

2015

2014

2015

2014

STATEMENT OF OPERATIONS

(unaudited)

(unaudited)

(in thousands, except share data)

(in thousands, except share data)

NET REVENUE

$                  115,893

$                  112,171

$                  341,477

$                  331,657

OPERATING EXPENSES

Programming and technical, excluding stock-based compensation

32,785

36,520

98,667

105,712

Selling, general and administrative, excluding stock-based compensation

40,922

37,006

116,813

111,064

Corporate selling, general and administrative, excluding stock-based compensation

11,256

9,845

33,840

29,284

Stock-based compensation

1,016

61

3,795

171

Depreciation and amortization 

8,277

9,179

26,345

27,685

Impairment of long-lived assets

14,545

-

14,545

-

Total operating expenses 

108,801

92,611

294,005

273,916

             Operating income

7,092

19,560

47,472

57,741

INTEREST INCOME

33

40

68

174

INTEREST EXPENSE

20,356

19,350

59,620

60,468

LOSS ON RETIREMENT OF DEBT

-

-

7,091

5,679

OTHER (INCOME) EXPENSE, net

(39)

(29)

246

16

(Loss) income before provision for income taxes and noncontrolling interest in income of subsidiaries 

(13,192)

279

(19,417)

(8,248)

PROVISION FOR INCOME TAXES

4,439

9,037

22,911

26,220

CONSOLIDATED NET LOSS

(17,631)

(8,758)

(42,328)

(34,468)

NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS

514

4,462

7,345

14,751

CONSOLIDATED NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS

$                  (18,145)

$                  (13,220)

$                  (49,673)

$                  (49,219)

AMOUNTS ATTRIBUTABLE TO COMMON STOCKHOLDERS

CONSOLIDATED NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS

$                  (18,145)

$                  (13,220)

$                  (49,673)

$                  (49,219)

Weighted average shares outstanding - basic2

48,220,262

47,601,371

47,963,763

47,502,733

Weighted average shares outstanding - diluted3

48,220,262

47,601,371

47,963,763

47,502,733

 

 

Three Months Ended September 30,

Nine Months Ended September 30, 

2015

2014

2015

2014

PER SHARE DATA - basic and diluted:

(unaudited)

(unaudited)

(in thousands, except per share data)

(in thousands, except per share data)

    Consolidated net loss attributable to common         stockholders (basic and diluted)

$                      (0.38)

$                  (0.28)

$                    (1.04)

$                  (1.04)

SELECTED OTHER DATA

Station operating income 1

$                    42,186

$                38,645

$                125,997

$              114,881

Station operating income margin (% of net revenue)

36.4%

34.5%

36.9%

34.6%

Station operating income reconciliation:

    Consolidated net loss attributable to common         stockholders

$                  (18,145)

$              (13,220)

$                (49,673)

$              (49,219)

    Add back non-station operating income items         included in consolidated net loss:

Interest income

(33)

(40)

(68)

(174)

Interest expense

20,356

19,350

59,620

60,468

Provision for income taxes

4,439

9,037

22,911

26,220

Corporate selling, general and administrative    expenses

11,256

9,845

33,840

29,284

Stock-based compensation

1,016

61

3,795

171

Loss on retirement of debt

-

-

7,091

5,679

Other (income) expense, net

(39)

(29)

246

16

Depreciation and amortization

8,277

9,179

26,345

27,685

Noncontrolling interest in income of subsidiaries

514

4,462

7,345

14,751

Impairment of long-lived assets

14,545

-

14,545

-

Station operating income

$                    42,186

$                38,645

$                125,997

$              114,881

Adjusted EBITDA4

$                    31,891

$                29,346

$                  94,580

$                87,834

Adjusted EBITDA reconciliation:

    Consolidated net loss attributable to common         stockholders

$                  (18,145)

$              (13,220)

$                (49,673)

$              (49,219)

Interest income

(33)

(40)

(68)

(174)

Interest expense

20,356

19,350

59,620

60,468

Provision for income taxes

4,439

9,037

22,911

26,220

Depreciation and amortization

8,277

9,179

26,345

27,685

EBITDA

$                    14,894

$                24,306

$                  59,135

$                64,980

Stock-based compensation

1,016

61

3,795

171

Loss on retirement of debt

-

-

7,091

5,679

Other (income) expense, net

(39)

(29)

246

16

Noncontrolling interest in income of subsidiaries

514

4,462

7,345

14,751

Employment Agreement Award and incentive plan    award expenses*

961

546

2,423

2,237

Impairment of long-lived assets

14,545

-

14,545

-

Adjusted EBITDA

$                    31,891

$                29,346

$                  94,580

$                87,834

*The Company modified the definition of Adjusted EBITDA during 2014 for the inclusion of Employment Agreement Award and incentive plan award expenses.  All prior periods have been reclassified to conform to current period presentation.

    

 

September 30, 2015

December 31, 2014

(unaudited) 

(in thousands)

SELECTED BALANCE SHEET DATA:

Cash and cash equivalents

$                    59,158

$                   67,781

Intangible assets, net

1,076,756

1,112,443

Total assets

1,363,288

1,391,694

Total debt (including current portion, net of original issue discount and issuance costs)

1,023,947

813,444

Total liabilities

1,400,188

1,160,286

Total (deficit) equity

(47,625)

220,572

Redeemable noncontrolling interest

10,725

10,836

Noncontrolling interest

848

201,674

Current Amount Outstanding

Applicable Interest Rate

(in thousands)

SELECTED LEVERAGE DATA:

2015 Credit Facility, net of original issue discount and issuance costs of approximately $12.8 million (subject to variable rates) (a)

$                  336,315

4.83%

9.25% senior subordinated notes due February 2020, net of original issue discount and issuance costs of approximately $3.4 million (fixed rate)

331,602

9.25%

7.375% senior secured notes due April 2022, net of original issue discount and issuance costs of approximately $5.8 million (fixed rate)

344,158

7.375%

Comcast Note due April 2019 (fixed rate)

11,872

10.47%

(a)       Subject to variable Libor plus a spread that is incorporated into the applicable interest rate set forth above.

 

Cautionary Note Regarding Forward-Looking Statements

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements represent management's current expectations and are based upon information available to Radio One at the time of this release. These forward-looking statements involve known and unknown risks, uncertainties and other factors, some of which are beyond Radio One's control, that may cause the actual results to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements.  Important factors that could cause actual results to differ materially are described in Radio One's reports on Forms 10-K, 10-Q, 8-K and other filings with the Securities and Exchange Commission (the "SEC"). Radio One does not undertake any duty to update any forward-looking statements.

Net revenue consists of gross revenue, net of local and national agency and outside sales representative commissions. Agency and outside sales representative commissions are calculated based on a stated percentage applied to gross billing.

 

Three Months Ended September 30,

2015

2014

$ Change

% Change

  (Unaudited)

Net Revenue:

Radio Advertising

$

55,579

$

60,197

$

(4,618)

-7.7%

Political Advertising

413

461

(48)

-10.4%

Digital Advertising

6,857

7,130

(273)

-3.8%

Cable Television Advertising

22,069

19,481

2,588

13.3%

Cable Television Affiliate Fees

25,502

19,942

5,560

27.9%

Event Revenues & Other

5,473

4,960

513

10.3%

Net Revenue (as reported)

$

115,893

$

112,171

$

3,722

3.3%

Net revenue increased to approximately $115.9 million for the quarter ended September 30, 2015, from approximately $112.2 million for the same period in 2014, an increase of 3.3%, resulting primarily from greater advertising demand and an increase in affiliate revenue at our cable television segment. Net revenues from our radio broadcasting segment decreased 6.6% for the quarter ended September 30, 2015, from the same period in 2014. We experienced net revenue growth in certain markets (most significantly in our Cleveland, Dallas, Philadelphia, and St. Louis markets); however, this growth was offset by declines in other markets (with our Atlanta, Baltimore, Detroit, Columbus, Houston, Indianapolis, and Washington D.C. markets experiencing the most significant declines). Reach Media's net revenues decreased slightly by $132,000 or 1.0% in the third quarter 2015, compared to the same period in 2014. We recognized approximately $47.6 million of revenue from our cable television segment during the three months ended September 30, 2015, compared to approximately $39.5 million for the same period in 2014, the increase due primarily from greater advertising demand and an increase in affiliate sales. Finally, net revenues for our internet business decreased 5.5% for the three months ended September 30, 2015, compared to the same period in 2014 due to a decline in alliance revenue.

Operating expenses, excluding depreciation and amortization, stock-based compensation and impairment of long-lived assets, increased to approximately $85.0 million for the quarter ended September 30, 2015, up 1.9% from the approximately $83.4 million incurred for the comparable quarter in 2014.

Depreciation and amortization expense decreased to approximately $8.3 million compared to approximately $9.2 million for the quarters ended September 30, 2015 and 2014, respectively, a decrease of 9.8%. The decrease was due to the completion of useful lives for certain assets. 

During the quarter ended September 30, 2015, the Company identified a triggering event to perform a goodwill interim impairment analysis on the Interactive One reporting unit. Based on preliminary calculations, the Company recorded an estimated goodwill impairment charge related to Interactive One of approximately $14.5 million during the quarter ended September 30, 2015. The Company expects to finalize the step two impairment analysis and record any adjustments to the preliminary amount during the fourth quarter of 2015.

Interest expense increased to approximately $20.4 million for the quarter ended September 30, 2015, compared to approximately $19.4 million for the same period in 2014.  On April 17, 2015, the Company's 2011 Credit Agreement, as amended, and TV One notes were paid off, with balances of $367.6 million and $119.0 million, respectively. The payoffs were achieved by the Company entering into its new $350.0 million 2015 Credit Facility, issuing the 2022 Notes in an aggregate principal amount of $350.0 million and the Comcast Note in the aggregate principal amount of approximately $11.9 million. The Company made cash interest payments of approximately $23.8 million on all outstanding instruments for the quarter ended September 30, 2015, compared to cash interest payments of approximately $26.3 million on all outstanding instruments for the quarter ended September 30, 2014.

The provision for income taxes for the quarter ended September 30, 2015, was approximately $4.4 million compared to approximately $9.0 million for the comparable period in 2014, a decrease of approximately $4.6 million.  The decrease was primarily attributable to the reduction in tax amortization from previously acquired indefinite-lived intangible assets and due to provision to return adjustments from the 2014 income tax returns. The Company paid $3,000 and $117,000 in taxes for the quarters ended September 30, 2015 and 2014, respectively.

The decrease in noncontrolling interests in income of subsidiaries is due primarily to a change in ownership percentage of TV One. 

Other pertinent financial information includes capital expenditures of approximately $1.5 million and $1.3 million for the quarters ended September 30, 2015 and 2014, respectively.  The Company received dividends from TV One in the amount of approximately $0 and $8.9 million for the quarters ended September 30, 2015 and 2014, respectively. The Company received dividends from Reach Media in the amount of approximately $4.0 million for the quarter ended September 30, 2015 and did not receive a dividend for the quarter ended September 30, 2014. As of September 30, 2015, the Company had total debt (net of cash balances, original issue discount and issuance costs) of approximately $964.8 million. During the nine months ended September 30, 2015, the Company repurchased 345,293 shares of Class D common stock, granted to certain employees, in the amount of approximately $1.4 million. The Company, as part of its 2009 stock plan, is authorized to purchase shares of Class D common stock to satisfy employee's tax obligations in connection with the vesting of share grants under the plan.  There were no stock repurchases made during the three month period ended September 30, 2015, or during the three and nine month periods ended September 30, 2014.

Supplemental Financial Information:

For comparative purposes, the following more detailed, unaudited statements of operations for the three and nine months ended September 30, 2015 and 2014 are included.  

 

Three Months Ended September 30, 2015

(in thousands, unaudited)

Corporate/

Radio  

Reach

Cable

Eliminations/

Consolidated

Broadcasting

Media

Internet

Television

Other

STATEMENT OF OPERATIONS:

NET REVENUE

$

115,893

$

50,880

$

13,486

$

5,503

$

47,571

$

(1,547)

OPERATING EXPENSES:

Programming and technical 

32,785

10,199

5,729

1,955

16,089

(1,187)

Selling, general and administrative

40,922

21,109

4,518

3,457

12,819

(981)

Corporate selling, general and administrative

11,256

-

814

-

3,079

7,363

Stock-based compensation

1,016

67

-

15

-

934

Depreciation and amortization

8,277

1,145

(394)

446

6,554

526

Impairment of long-lived assets

14,545

-

-

14,545

-

-

Total operating expenses

108,801

32,520

10,667

20,418

38,541

6,655

           Operating income (loss)

7,092

18,360

2,819

(14,915)

9,030

(8,202)

INTEREST INCOME

33

-

-

-

-

33

INTEREST EXPENSE

20,356

305

-

-

1,919

18,132

OTHER INCOME, net

(39)

(3)

-

-

-

(36)

(Loss) income before provision for income taxes and noncontrolling interest in income of subsidiaries 

(13,192)

18,058

2,819

(14,915)

7,111

(26,265)

PROVISION FOR INCOME TAXES

4,439

4,385

54

-

-

-

CONSOLIDATED NET (LOSS) INCOME 

(17,631)

13,673

2,765

(14,915)

7,111

(26,265)

NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS

514

-

-

-

-

514

NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

(18,145)

$

13,673

$

2,765

$

(14,915)

$

7,111

$

(26,779)

Adjusted EBITDA4

$

31,891

$

19,572

$

2,425

$

91

$

15,663

$

(5,860)

 

 

Three Months Ended September 30, 2014

(in thousands, unaudited)

Corporate/

Radio  

Reach

Cable

Eliminations/

Consolidated

Broadcasting

Media

Internet

Television

Other

STATEMENT OF OPERATIONS:

NET REVENUE

$

112,171

$

54,498

$

13,618

$

5,822

$

39,488

$

(1,255)

OPERATING EXPENSES:

Programming and technical 

36,520

11,185

8,018

2,239

16,565

(1,487)

Selling, general and administrative

37,006

21,288

4,088

3,133

8,947

(450)

Corporate selling, general and administrative

9,845

-

1,200

-

1,583

7,062

Stock-based compensation

61

5

-

-

-

56

Depreciation and amortization

9,179

1,241

285

598

6,523

532

Total operating expenses

92,611

33,719

13,591

5,970

33,618

5,713

           Operating income (loss)

19,560

20,779

27

(148)

5,870

(6,968)

INTEREST INCOME

40

-

-

-

13

27

INTEREST EXPENSE

19,350

255

-

-

3,039

16,056

OTHER INCOME, net

(29)

-

-

-

-

(29)

Income (loss) before provision for income taxes and noncontrolling interest in income of subsidiaries 

279

20,524

27

(148)

2,844

(22,968)

PROVISION FOR INCOME TAXES

9,037

9,014

23

-

-

-

CONSOLIDATED NET (LOSS) INCOME 

(8,758)

11,510

4

(148)

2,844

(22,968)

NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS

4,462

-

-

-

-

4,462

NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

(13,220)

$

11,510

$

4

$

(148)

$

2,844

$

(27,430)

Adjusted EBITDA4

$

29,346

$

22,025

$

312

$

450

$

12,393

$

(5,834)

 

 

Nine Months Ended September 30, 2015

(in thousands, unaudited)

Corporate/

Radio  

Reach

Cable

Eliminations/

Consolidated

Broadcasting

Media

Internet

Television

Other

STATEMENT OF OPERATIONS:

NET REVENUE

$

341,477

$

149,093

$

42,508

$

15,763

$

138,898

$

(4,785)

OPERATING EXPENSES:

Programming and technical 

98,667

30,645

17,000

6,255

48,270

(3,503)

Selling, general and administrative

116,813

64,446

15,910

10,034

29,563

(3,140)

Corporate selling, general and administrative

33,840

-

3,131

-

9,515

21,194

Stock-based compensation

3,795

206

-

53

-

3,536

Depreciation and amortization

26,345

3,469

137

1,559

19,600

1,580

Impairment of long-lived assets

14,545

-

-

14,545

-

-

Total operating expenses

294,005

98,766

36,178

32,446

106,948

19,667

           Operating income (loss) 

47,472

50,327

6,330

(16,683)

31,950

(24,452)

INTEREST INCOME

68

-

-

-

(93)

161

INTEREST EXPENSE

59,620

915

-

-

7,212

51,493

LOSS ON RETIREMENT OF DEBT

7,091

-

-

-

-

7,091

OTHER EXPENSE, net

246

52

-

-

92

102

(Loss) income before provision for income taxes and noncontrolling interest in income of subsidiaries 

(19,417)

49,360

6,330

(16,683)

24,553

(82,977)

PROVISION FOR INCOME TAXES

22,911

22,796

115

-

-

-

CONSOLIDATED NET (LOSS) INCOME

(42,328)

26,564

6,215

(16,683)

24,553

(82,977)

NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS

7,345

-

-

-

-

7,345

NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

(49,673)

$

26,564

$

6,215

$

(16,683)

$

24,553

$

(90,322)

Adjusted EBITDA4

$

94,580

$

54,002

$

6,467

$

(526)

$

51,629

$

(16,992)

 

 

Nine Months Ended September 30, 2014

(in thousands, unaudited)

Corporate/

Radio  

Reach

Cable

Eliminations/

Consolidated

Broadcasting

Media

Internet

Television

Other

STATEMENT OF OPERATIONS:

NET REVENUE

$

331,657

$

159,906

$

40,433

$

18,175

$

117,166

$

(4,023)

OPERATING EXPENSES:

Programming and technical 

105,712

32,758

23,899

6,949

46,312

(4,206)

Selling, general and administrative

111,064

64,421

12,762

10,468

25,051

(1,638)

Corporate selling, general and administrative

29,284

-

3,566

-

5,532

20,186

Stock-based compensation

171

15

-

-

-

156

Depreciation and amortization

27,685

3,832

862

1,830

19,597

1,564

Total operating expenses

273,916

101,026

41,089

19,247

96,492

16,062

           Operating income (loss) 

57,741

58,880

(656)

(1,072)

20,674

(20,085)

INTEREST INCOME

174

-

-

-

40

134

INTEREST EXPENSE

60,468

860

-

-

9,117

50,491

LOSS ON RETIREMENT OF DEBT

5,679

-

-

-

-

5,679

OTHER EXPENSE (INCOME),  net

16

(1)

-

-

96

(79)

(Loss) income before provision for income taxes and noncontrolling interest in income of subsidiaries 

(8,248)

58,021

(656)

(1,072)

11,501

(76,042)

PROVISION FOR INCOME TAXES

26,220

26,174

46

-

-

-

CONSOLIDATED NET (LOSS) INCOME

(34,468)

31,847

(702)

(1,072)

11,501

(76,042)

NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS

14,751

-

-

-

-

14,751

NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

(49,219)

$

31,847

$

(702)

$

(1,072)

$

11,501

$

(90,793)

Adjusted EBITDA4

$

87,834

$

62,727

$

206

$

758

$

40,459

$

(16,316)

 

Radio One, Inc. will hold a conference call to discuss its results for third fiscal quarter of 2015. The conference call is scheduled for Thursday, November 05, 2015 at 10:00 a.m. EST. To participate on this call, U.S. callers may dial toll-free 1-800-288-8968; international callers may dial direct (+1) 612-332-0345.

A replay of the conference call will be available from 12:00 p.m. EST November 05, 2015 until 11:59 p.m. EST November 07, 2015. Callers may access the replay by calling 1-800-475-6701; international callers may dial direct (+1) 320-365-3844. The replay Access Code is 371635. Access to live audio and a replay of the conference call will also be available on Radio One's corporate website at www.radio-one.com. The replay will be made available on the website for seven days after the call.

Radio One, Inc. (radio-one.com), together with its subsidiaries, is a diversified media company that primarily targets African-American and urban consumers. It is one of the nation's largest radio broadcasting companies, currently owning and/or operating 54 stations in 16 urban markets in the United States. Through its controlling interest in Reach Media, Inc. (blackamericaweb.com), the Company also operates syndicated programming including the Tom Joyner Morning Show, the Russ Parr Morning Show, the Yolanda Adams Morning Show, the Rickey Smiley Morning Show, the DL Hughley Show, Bishop T.D. Jakes' Empowering Moments, and the Reverend Al Sharpton Show.

Beyond its core radio broadcasting franchise, Radio One owns Interactive One (interactiveone.com), the fastest growing and definitive digital resource for Black and Latin Americans, reaching millions each month through social content, news, information, and entertainment. Interactive One operates a number of branded sites including News One (news), The Urban Daily (men), Hello Beautiful (women), Global Grind (Millennials) and social networking websites such as BlackPlanet and MiGente. The Company also owns TV One, LLC (tvone.tv), a cable/satellite network programming serving more than 57 million households, offering a broad range of real-life and entertainment-focused original programming, classic series, movies and music designed to entertain, inform and inspire a diverse audience of adult Black viewers.  Additionally, One Solution combines the dynamics of the Radio One's holdings to provide brands with an integrated and effectively engaging marketing approach that reaches 82% of Black Americans throughout the country.

Notes:

  1. "Station operating income" consists of net loss before depreciation and amortization, corporate expenses, stock-based compensation, equity in income of affiliated company, income taxes, noncontrolling interest in income (loss) of subsidiaries, interest expense, impairment of long-lived assets, other (income) expense, loss (gain) on retirement of debt, (income) loss from discontinued operations, net of tax, interest income and gain on purchase of affiliated company. Station operating income is not a measure of financial performance under generally accepted accounting principles. Nevertheless station operating income is a significant basis used by our management to measure the operating performance of our stations within the various markets because station operating income provides helpful information about our results of operations apart from expenses associated with our fixed assets and long-lived intangible assets, income taxes, investments, debt financings and retirements, overhead, stock-based compensation, impairment charges, and asset sales. Our measure of station operating income may not be comparable to similarly titled measures of other companies as our definition includes the results of all four segments (Radio Broadcasting, Reach Media, Internet and Cable Television). Station operating income does not purport to represent operating income or cash flow from operating activities, as those terms are defined under generally accepted accounting principles, and should not be considered as an alternative to those measurements as an indicator of our performance. A reconciliation of net income (loss) to station operating income has been provided in this release.
  2. For the three months ended September 30, 2015 and 2014, Radio One had 48,220,262 and 47,601,371 shares of common stock outstanding on a weighted average basis (basic), respectively.  For the nine months ended September 30, 2015 and 2014, Radio One had 47,963,763 and 47,502,733 shares of common stock outstanding on a weighted average basis (basic), respectively. 
  3. For the three months ended September 30, 2015 and 2014, Radio One had 48,220,262 and 47,601,371  shares of common stock outstanding on a weighted average basis (fully diluted), for outstanding stock options, respectively.  For the nine months ended September 30, 2015 and 2014, Radio One had 47,963,763 and 47,502,733 shares of common stock outstanding on a weighted average basis (fully diluted), for outstanding stock options, respectively.
  4. "Adjusted EBITDA" consists of net loss plus (1) depreciation, amortization, income taxes, interest expense, noncontrolling interest in income of subsidiaries, impairment of long-lived assets, stock-based compensation, loss on retirement of debt, Employment Agreement and incentive plan award expenses, loss from discontinued operations, net of tax, less (2) equity in income of affiliated company, other income, interest income, gain on retirement of debt and gain on purchase of affiliated company. Net income before interest income, interest expense, income taxes, depreciation and amortization is commonly referred to in our business as "EBITDA." Adjusted EBITDA and EBITDA are not measures of financial performance under generally accepted accounting principles. However, we believe Adjusted EBITDA is often a useful measure of a company's operating performance and is a significant basis used by our management to measure the operating performance of our business because Adjusted EBITDA excludes charges for depreciation, amortization and interest expense that have resulted from our acquisitions and debt financing, our taxes, impairment charges, as well as our equity in (income) loss of our affiliated company, gain on retirements of debt, and any discontinued operations. Accordingly, we believe that Adjusted EBITDA provides useful information about the operating performance of our business, apart from the expenses associated with our fixed assets and long-lived intangible assets, capital structure or the results of our affiliated company. Adjusted EBITDA is frequently used as one of the bases for comparing businesses in our industry, although our measure of Adjusted EBITDA may not be comparable to similarly titled measures of other companies as our definition includes the results of all four segments (Radio Broadcasting, Reach Media, Internet and Cable Television).  Adjusted EBITDA and EBITDA do not purport to represent operating income or cash flow from operating activities, as those terms are defined under generally accepted accounting principles, and should not be considered as alternatives to those measurements as an indicator of our performance. A reconciliation of net income (loss) to EBITDA and Adjusted EBITDA has been provided in this release.

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SOURCE Radio One, Inc.



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