Saga Communications, Inc. Reports 3rd Quarter 2015 Results

Free Cash Flow increased 11.3%

Nov 05, 2015, 09:00 ET from Saga Communications, Inc.

GROSSE POINTE FARMS, Mich., Nov. 5, 2015 /PRNewswire/ -- Saga Communications, Inc. (NYSE MKT: SGA) today reported free cash flow increased 11.3% to $5.5 million for the quarter ended September 30, 2015.  Net revenue decreased 1.6% to $33.8 million.  Station operating expense decreased $2.0 million to $24.3 million (station operating expense includes depreciation and amortization attributable to the stations).  Operating income increased 14.0% to $6.5 million.  Net income for the period was $3.1 million ($0.53 per fully diluted share). 

Free cash flow increased 3.2% to $14.7 million for the nine months ended September 30, 2015.  Net revenue decreased 0.4% to $97.3 million.  Station operating expense decreased 1.9% to $71.4 million (station operating expense includes depreciation and amortization attributable to the stations).  Operating income was $17.8 million.  Net income for the nine month period was $9.7 million ($1.67 per fully diluted share). 

Capital expenditures were $2.2 million in the 3rd quarter compared to $0.9 million for the same period last year.  The Company currently expects to spend approximately $5.5 million to $6.0 million for capital expenditures during 2015. 

During the quarter the Company closed on it purchases of 4 FM and 2 AM radio stations serving the Harrisonburg, VA radio market.  The total purchase price was $11.0 million.

Saga's 2015 3rd Quarter conference call will be on Thursday, November 5, 2015 at 11:00 a.m. EST.  The dial-in number for the call is (612) 288-0337.  A transcript of the call will be posted to the Company's website.  

The Company requests that all parties that have a question that they would like to submit to the Company to please email the inquiry by 10:00 a.m. EST on November 5, 2015 to SagaIR@sagacom.com. The Company will discuss, during the limited period of the conference call, those inquiries it deems of general relevance and interest. Only inquiries made in compliance with the foregoing will be discussed during the call.

The attached Selected Supplemental Financial Data tables disclose "actual", "same station" and "proforma" information by segment as well as the Company's trailing 12 month consolidated EBITDA.  The "actual" amounts reflect our historical financial results and include the results of operations for stations that we did not own for the entire comparable period.  The "same station" amounts reflect only the results of operations for stations that we owned for the entire comparable period. The "proforma" amounts assume all acquisitions in 2015 occurred as of January 1, 2014.

Saga utilizes certain financial measures that are not calculated in accordance with generally accepted accounting principles (GAAP) to assess its financial performance.  Such non-GAAP measures include same station financial information, free cash flow, trailing 12 month consolidated EBITDA, and leverage ratio. These non-GAAP measures are generally recognized by the broadcasting industry as measures of performance and are used by Saga to assess its financial performance including, but not limited to, evaluating individual station and market-level performance, evaluating overall operations, as a primary measure for incentive based compensation of executives and other members of management and as a measure of financial position.  Saga's management believes these non-GAAP measures are used by analysts who report on the industry and by investors to provide meaningful comparisons between broadcasting groups, as well as an indicator of their market value.  These measures are not measures of liquidity or of performance in accordance with GAAP, and should be viewed as a supplement to and not as a substitute for the results of operations presented on a GAAP basis including net operating revenue, operating income, and net income. Reconciliations for all of the non-GAAP financial measures to the most directly comparable GAAP measure are attached in the Selected Consolidated and Supplemental Financial Data tables.

This press release contains certain forward-looking statements that are based upon current expectations and involve certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995.  Words such as "believes," "expects," "anticipates," "guidance" and similar expressions are intended to identify forward-looking statements.  Key risks, including risks associated with Saga's ability to effectively integrate the stations it acquires and the impact of federal regulation on Saga's business, are described in the reports Saga periodically files with the U.S. Securities and Exchange Commission, including Item 1A of our Annual Report on Form 10-K.  Readers should note that these statements may be impacted by several factors, including national and local economic changes and changes in the radio and television broadcast industry in general, as well as Saga's actual performance.  Results may vary from those stated herein and Saga undertakes no obligation to update the information contained here.

Saga is a broadcasting company whose business is devoted to acquiring, developing and operating broadcast properties.  Saga owns or operates broadcast properties in 26 markets, including 66 FM and 32 AM radio stations, 1 state radio network, 4 television stations and 5 low-power television stations. For additional information, contact us at (313) 886-7070 or visit our website at www.sagacom.com.

 

Saga Communications, Inc.

Selected Consolidated Financial Data

For The Three and Nine Months Ended

September 30, 2015 and 2014

(amounts in 000's except per share data)

(Unaudited)











 Three Months Ended  

 Nine Months Ended  




 September 30, 

 September 30, 




2015

2014

2015

2014

Operating Results






Net operating revenue


$         33,831

$        34,373

$         97,250

$         97,627

Station operating expense


24,324

26,366

71,400

72,812

Corporate general and administrative


2,577

2,307

7,642

6,580

Other operating expense, net


433

-

447

-

Operating income 


$        6,497

$       5,700

$         17,761

$         18,235

Interest expense


229

268

714

812

Write-off of debt issuance costs


557

-

557

-

Other (income) expense, net


-

7

(417)

(38)

Income tax expense


2,599

2,180

7,190

7,000

Net income


$           3,112

$          3,245

$           9,717

$         10,461








Earnings Per Share







Basic


$             0.54

$           0.56

$             1.68

$             1.82


Diluted


$             0.53

$           0.56

$             1.67

$             1.80








Weighted average common shares


5,724

5,699

5,708

5,696

Weighted average common and common 







equivalent shares


5,752

5,742

5,749

5,751








Free Cash Flow






Net income 


$           3,112

$          3,245

$           9,717

$         10,461

Plus: Depreciation and amortization:







        Station


1,642

1,595

4,692

4,752


        Corporate


89

77

234

205


    Write-off of debt issuance costs


557

-

557

-

         Deferred tax provision


1,464

710

2,730

2,130

         Non-cash compensation


373

193

1,200

572

         Other operating expense, net


433

-

447

-

         Other income (expense), net


-

7

(417)

(38)

Less: Capital expenditures


(2,173)

(887)

(4,427)

(3,801)

Free cash flow


$           5,497

$          4,940

$         14,733

$         14,281













 September 30, 






2015

2014

Balance Sheet Data







Working capital




$         29,910

$         35,872


Net fixed assets




$         58,997

$         55,568


Net intangible assets and other assets




$         98,780

$         95,211


Total assets




$       204,162

$       204,515


Long-term debt




$         36,365

$         41,078


Stockholders' equity




$       121,884

$       118,921








 

 

Saga Communications, Inc.

Selected Supplemental Financial Data

For the Three Months Ended

September 30, 2015 and 2014

(amounts in 000's except per share data)

(Unaudited)











Actual


Same Station


Pro Forma (1)


Three Months Ended


Three Months Ended


Three Months Ended


September 30,


September 30,


September 30,


2015

2014


2015

2014


2015

2014

Consolidated









Net operating revenue

$      33,831

$      34,373


$      33,260

$      33,715


$34,243

$35,433

Station operating expense

24,324

26,366


23,862

25,753


24,654

27,151

Corporate general and administrative

2,577

2,307


2,577

2,307


2,577

2,307

Other operating expense, net

433

-


33

-


433

-

Operating income

$        6,497

$        5,700


$        6,788

$        5,655


6,579

5,975

Interest expense

229

268





229

268

Write-off of debt issuance costs

557

-





557

-

Other (income) expense, net

-

7





-

7

Income tax expense

2,599

2,180





2,632

2,293

Net income 

$        3,112

$        3,245





$        3,161

$        3,407

Earnings per share:









  Basic

$          0.54

$          0.56





$0.55

$0.60

  Diluted

$          0.53

$          0.56





$0.55

$0.59











Actual


Same Station


Pro Forma (1)


Three Months Ended


Three Months Ended


Three Months Ended


September 30,


September 30,


September 30,


2015

2014


2015

2014


2015

2014

Radio Segment









Net operating revenue

$      28,536

$      29,400


$      27,965

$      28,742


$28,948

$30,460

Station operating expense

20,825

23,082


20,363

22,469


21,155

23,867

Other operating expense, net

400

-


-

-


400

-

Operating income

$        7,311

$        6,318


$        7,602

$        6,273


$7,393

$6,593




















Actual


Same Station


Pro Forma (1)


Three Months Ended


Three Months Ended


Three Months Ended


September 30,


September 30,


September 30,


2015

2014


2015

2014


2015

2014

Television Segment









Net operating revenue

$        5,295

$        4,973


$        5,295

$        4,973


$5,295

$4,973

Station operating expense

3,499

3,284


3,499

3,284


3,499

3,284

Other operating expense, net

33

-


33

-


33

-

Operating income

$        1,763

$        1,689


$        1,763

$        1,689


$1,763

$1,689




















Actual


Same Station


Pro Forma (1)


Three Months Ended


Three Months Ended


Three Months Ended


September 30,


September 30,


September 30,


2015

2014


2015

2014


2015

2014

Depreciation and amortization










by segment









Radio Segment

$        1,295

$        1,245


$        1,200

$        1,223


$1,362

$1,409

Television Segment

347

350


347

350


347

350

Corporate and Other

89

77


89

77


89

77


$        1,731

$        1,672


$        1,636

$        1,650


$1,798

$1,836










(1)

Pro Forma results assume all acquisitions in 2015 occurred as of January 1, 2014.










 

 

Saga Communications, Inc.

Selected Supplemental Financial Data

For the Nine Months Ended

September 30, 2015 and 2014

(amounts in 000's except per share data)

(Unaudited)











Actual


Same Station


Pro Forma (1)


Nine Months Ended


Nine Months Ended


Nine Months Ended


September 30,


September 30,


September 30,


2015

2014


2015

2014


2015

2014

Consolidated









Net operating revenue

$      97,250

$      97,627


$      96,679

$      95,938


$99,723

$100,828

Station operating expense

71,400

72,812


70,891

70,981


73,362

75,186

Corporate general and administrative

7,642

6,580


7,642

6,580


7,642

6,580

Other operating expense, net

447

-


47

-


447

-

Operating income

$      17,761

$      18,235


$      18,099

$      18,377


18,272

19,062

Interest expense

714

812





714

812

Write-off of debt issuance costs

557

-





557

-

Other (income) expense, net

(417)

(38)





(417)

(38)

Income tax expense

7,190

7,000





7,399

7,339

Net income 

$        9,717

$      10,461





$      10,019

$      10,949

Earnings per share:









  Basic

$          1.68

$          1.82





$1.76

$1.92

  Diluted

$          1.67

$          1.80





$1.74

$1.90











Actual


Same Station


Pro Forma (1)


Nine Months Ended


Nine Months Ended


Nine Months Ended


September 30,


September 30,


September 30,


2015

2014


2015

2014


2015

2014

Radio Segment









Net operating revenue

$      81,829

$      83,176


$      81,258

$      81,487


$84,302

$86,377

Station operating expense

61,066

63,021


60,557

61,190


63,028

65,395

Other operating expense, net

414

-


14

-


414

-

Operating income

$      20,349

$      20,155


$      20,687

$      20,297


$      20,860

$      20,982




















Actual


Same Station


Pro Forma (1)


Nine Months Ended


Nine Months Ended


Nine Months Ended


September 30,


September 30,


September 30,


2015

2014


2015

2014


2015

2014

Television Segment









Net operating revenue

$      15,421

$      14,451


$      15,421

$      14,451


$15,421

$14,451

Station operating expense

10,334

9,791


10,334

9,791


10,334

9,791

Other operating expense, net

33

-


33

-


33

-

Operating income

$        5,054

$        4,660


$        5,054

$        4,660


$        5,054

$        4,660




















Actual


Same Station


Pro Forma (1)


Nine Months Ended


Nine Months Ended


Nine Months Ended


September 30,


September 30,


September 30,


2015

2014


2015

2014


2015

2014

Depreciation and amortization










by segment









Radio Segment

$        3,676

$        3,711


$        3,581

$        3,646


4,071

4,203

Television Segment

1,016

1,041


1,016

1,041


1,016

1,041

Corporate and Other

234

205


234

205


234

205



$        4,926

$        4,957


$        4,831

$        4,892


$5,321

$5,449











(1)

Pro Forma results assume all acquisitions in 2015 occurred as of January 1, 2014.











 

 

 

Saga Communications, Inc.

Selected Supplemental Financial Data

September 30, 2015

(amounts in 000's except ratios)

(Unaudited)





































Less:


Plus:


Add:


Trailing


12 Mos Ended


9 Mos Ended


9 Mos Ended


Proforma


12 Mos Ended


December 31,


September 30,


September 30,


Acquistions


September 30,


2014


2014


2015




2015

Trailing 12 Month Consolidated Earnings Before Interest










  Taxes, Depreciation and Amortization ("EBITDA") (1)










Net income

$14,904


$10,461


$9,717


$415


$14,575

Exclusions:











Gain (loss) on sale of assets

1,281


38


(447)




796


Gain on insurance claim

-


-


417




417


Impairment of intangible assets

(1,936)


-


-




(1,936)


Write-off of debt issuance costs



-


(557)




(557)


Other

213


299


147




61

Total exclusions

(442)


337


(440)


-


(1,219)











Consolidated adjusted net income (1)

15,346


10,124


10,157


415


15,794

Plus:  Interest expense

1,064


812


714




966


Income tax expense

10,050


7,000


7,190


288


10,528


Depreciation & amortization expense

6,702


4,957


4,926


542


7,213


Amortization of television syndicated programming contracts

637


472


479




644


Non-cash stock based compensation expense

826


572


1,200




1,454

Less: Cash television programming payments

(627)


(464)


(476)




(639)











Trailing twelve month consolidated EBITDA (1)

$33,998


$23,473


$24,190


$1,245


$35,960











Total long-term debt, including current maturities









$36,365

Divided by trailing twelve month consolidated EBITDA (1)









35,960

Leverage ratio









1.0






















(1)

As defined in the Company's credit facility.












 

 

 

Saga Communications, Inc.

Selected Financial Data Non-GAAP Disclosures

For the Three Months Ended

September 30, 2015 and 2014

(amounts in 000's)

(Unaudited)



























Reconciliation of Actual (historical) Information to Same Station Operating Income 


















Adjustment






Adjustment





Actual


For Acquisitions


Same Station


Actual


For Acquisitions


Same Station



Three Months


and Dispositions


Three Months


Three Months


and Dispositions


Three Months



Ended


Not Included in 


Ended


Ended


Not Included in 


Ended



September 30,


Entire Comparable


September 30,


September 30,


Entire Comparable


September 30,



2015


Period


2015


2014


Period


2014

Consolidated












Net operating revenue

$                       33,831


$                                    (571)


$                       33,260


$                       34,373


$                                    (658)


$                       33,715

Station operating expense

24,324


(462)


23,862


26,366


(613)


25,753

Corporate general and administrative

2,577


-


2,577


2,307


-


2,307

Other operating expense, net

433


(400)


33


-


-


-

Operating income

$                         6,497


$                                      291


$                         6,788


$                         5,700


$                                      (45)


$                         5,655




























Adjustment






Adjustment




Actual


For Acquisitions


Same Station


Actual


For Acquisitions


Same Station


Three Months


and Dispositions


Three Months


Three Months


and Dispositions


Three Months


Ended


Not Included in 


Ended


Ended


Not Included in 


Ended


September 30,


Entire Comparable


September 30,


September 30,


Entire Comparable


September 30,


2015


Period


2015


2014


Period


2014

Radio Segment












Net operating revenue

$                       28,536


$                                    (571)


$                       27,965


$                       29,400


$                                    (658)


$                       28,742

Station operating expense

20,825


(462)


20,363


23,082


(613)


22,469

Other operating expense, net

400


(400)


-


-


-


-

Operating income

$                         7,311


$                                      291


$                         7,602


$                         6,318


$                                      (45)


$                         6,273




























Adjustment






Adjustment




Actual


For Acquisitions


Same Station


Actual


For Acquisitions


Same Station


Three Months


and Dispositions


Three Months


Three Months


and Dispositions


Three Months


Ended


Not Included in 


Ended


Ended


Not Included in 


Ended


September 30,


Entire Comparable


September 30,


September 30,


Entire Comparable


September 30,


2015


Period


2015


2014


Period


2014

Television Segment












Net operating revenue

$                         5,295


$                                        -


$                         5,295


$                         4,973


$                                        -


$                         4,973

Station operating expense

3,499


-


3,499


3,284


-


3,284

Other operating expense, net

33


-


33


-


-


-

Operating income

$                         1,763


$                                        -


$                         1,763


$                         1,689


$                                        -


$                         1,689














 

 

 

Saga Communications, Inc.

Selected Financial Data Non-GAAP Disclosures

For the Nine Months Ended

September 30, 2015 and 2014

(amounts in 000's)

(Unaudited)



























Reconciliation of Actual (historical) Information to Same Station Operating Income 

















Adjustment






Adjustment




Actual


For Acquisitions


Same Station


Actual


For Acquisitions


Same Station


Nine Months


and Dispositions


Nine Months


Nine Months


and Dispositions


Nine Months


Ended


Not Included in 


Ended


Ended


Not Included in 


Ended


September 30,


Entire Comparable


September 30,


September 30,


Entire Comparable


September 30,


2015


Period


2015


2014


Period


2014

Consolidated












Net operating revenue

$                       97,250


$                                    (571)


$                       96,679


$                       97,627


$                                 (1,689)


$                       95,938

Station operating expense

71,400


(509)


70,891


72,812


(1,831)


70,981

Corporate general and administrative

7,642


-


7,642


6,580


-


6,580

Other operating expense, net

447


(400)


47


-


-


-

Operating income

$                       17,761


$                                      338


$                       18,099


$                       18,235


$                                      142


$                       18,377




























Adjustment






Adjustment




Actual


For Acquisitions


Same Station


Actual


For Acquisitions


Same Station


Nine Months


and Dispositions


Nine Months


Nine Months


and Dispositions


Nine Months


Ended


Not Included in 


Ended


Ended


Not Included in 


Ended


September 30,


Entire Comparable


September 30,


September 30,


Entire Comparable


September 30,


2015


Period


2015


2014


Period


2014

Radio Segment












Net operating revenue

$                       81,829


$                                    (571)


$                       81,258


$                       83,176


$                                 (1,689)


$                       81,487

Station operating expense

61,066


(509)


60,557


63,021


(1,831)


61,190

Other operating expense, net

414


(400)


14


-


-


-

Operating income

$                       20,349


$                                      338


$                       20,687


$                       20,155


$                                      142


$                       20,297




























Adjustment






Adjustment




Actual


For Acquisitions


Same Station


Actual


For Acquisitions


Same Station


Nine Months


and Dispositions


Nine Months


Nine Months


and Dispositions


Nine Months


Ended


Not Included in 


Ended


Ended


Not Included in 


Ended


September 30,


Entire Comparable


September 30,


September 30,


Entire Comparable


September 30,


2015


Period


2015


2014


Period


2014

Television Segment












Net operating revenue

$                       15,421


$                                        -


$                       15,421


$                       14,451


$                                        -


$                       14,451

Station operating expense

10,334


-


10,334


9,791


-


9,791

Other operating expense, net

33


-


33


-


-


-

Operating income

$                         5,054


$                                        -


$                         5,054


$                         4,660


$                                        -


$                         4,660














 

SOURCE Saga Communications, Inc.



RELATED LINKS

http://www.sagacom.com