Saga Communications, Inc. Reports 4th Quarter and Year End 2015 Results Free Cash Flow increased 2.9% for the Year

08 Mar, 2016, 09:00 ET from Saga Communications, Inc.

GROSSE POINTE FARMS, Mich., March 8, 2016 /PRNewswire/ -- Saga Communications, Inc. (NYSE MKT: SGA) today reported free cash flow increased 2.2% to $6.8 million for the quarter ended December 31, 2015.  Gross revenue without political increased 2.1% for the quarter.  Net revenue (including political) decreased 2.1% to $35.6 million.  Station operating expense increased 1.0% to $25.9 million (station operating expense includes depreciation and amortization attributable to the stations).  Operating income decreased $1.4 million primarily due to the recognition of a $1.2 million gain during the 4th Quarter of 2014 in other operating income from the sale of four of the Company's radio networks and the non-cash impairment charge of $1.9 million during the quarter in 2014 compared to $874 thousand in 2015.  Net income for the period was $3.7 million ($0.63 per fully diluted share). 

Free cash flow increased 2.9% to $21.6 million for the year ended December 31, 2015.  Gross revenue without political increased 0.7% for the year.  Net revenue (including political) decreased 0.9% to $132.9 million.  Station operating expense decreased 1.2% to $97.3 million (station operating expense includes depreciation and amortization attributable to the stations).  Operating income decreased $1.9 million.  Net income for the year was $13.4 million ($2.29 per fully diluted share). 

Capital expenditures were down $600 thousand to $1.1 million in the 4th quarter compared to $1.7 million for the same period last year.  For the year capital expenditures were approximately even with last year at $5.5 million.  The Company currently expects to spend approximately $5.0 million to $5.5 million for capital expenditures during 2016.

During the 4th Quarter the Company entered into an Asset Purchase Agreement to purchase WLVQ – FM in Columbus, OH for $13.0 million as well as disposing of its last radio network, the Illinois Radio Network.  The Company begin operating WLVQ – FM pursuant to a Local Marketing Agreement as of November 16, 2015.  The Company closed on its purchase of WLVQ on February 3, 2016.

Saga's 2015 4th Quarter and Year End conference call will be on Tuesday, March 8, 2016 at 11:00 a.m. EST.  The dial-in number for the call is (612) 234-9960.  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 March 8, 2016 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" and "same station" 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.

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 67 FM and 32 AM radio stations, 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 Twelve Months Ended

December 31, 2015 and 2014

(amounts in 000's except per share data)

(Unaudited)











 Three Months Ended  

 Twelve Months Ended  




 December 31, 

 December 31, 




2015

2014

2015

2014

Operating Results






Net operating revenue


$         35,606

$        36,371

$       132,856

$        133,998

Station operating expense


25,868

25,612

97,268

98,424

Corporate general and administrative


2,449

2,321

10,091

8,901

Other operating expense (income), net


94

(1,210)

541

(1,210)

Impairment of intangible assets


874

1,936

874

1,936

Operating income


6,321

7,712

24,082

25,947

Interest expense


174

252

888

1,064

Write-off of debt issuance costs


-

-

557

-

Other income


-

(33)

(417)

(71)

Income tax expense


2,450

3,050

9,640

10,050

Net income


$           3,697

$          4,443

$         13,414

$         14,904








Earnings Per Share







Basic


$             0.63

$           0.77

$             2.31

$             2.57


Diluted


$             0.63

$           0.76

$             2.29

$             2.55








Weighted average common shares


5,732

5,709

5,706

5,700

Weighted average common and common 







equivalent shares


5,741

5,757

5,740

5,753








Free Cash Flow






Net income 


$           3,697

$          4,443

$         13,414

$         14,904

Plus: Depreciation and amortization:







        Station


1,842

1,682

6,534

6,434


        Corporate


56

63

290

268


    Write-off of debt issuance costs


-

-

557

-

         Deferred tax provision


910

1,255

3,640

3,385

         Non-cash compensation


455

254

1,655

826

         Other operating expense (income), net


94

(1,210)

541

(1,210)

         Impairment of intangible assets


874

1,936

874

1,936

         Other income 


-

(33)

(417)

(71)

Less: Capital expenditures


(1,116)

(1,723)

(5,543)

(5,524)

Free cash flow


$           6,812

$          6,667

$         21,545

$         20,948













 December 31, 






2015

2014

Balance Sheet Data







Working capital




$         33,557

$         30,554


Net fixed assets




$         58,131

$         55,187


Net intangible assets and other assets




$         98,545

$         93,270


Total assets




$       204,571

$       192,044


Long-term debt




$         36,365

$         36,078


Stockholders' equity




$       122,816

$       115,245

 

 

Saga Communications, Inc.

Selected Supplemental Financial Data

For the Three Months Ended

December 31, 2015 and 2014

(amounts in 000's except per share data)

(Unaudited)













Actual


Same Station (1)


Pro Forma (2)



Three Months Ended


Three Months Ended


Three Months Ended



December 31,


December 31,


December 31,



2015

2014


2015

2014


2015

2014

Consolidated









Net operating revenue

$      35,606

$    36,371


$      34,237

$      35,644


$      36,187

$      38,638

Station operating expense

25,868

25,612


24,593

25,164


26,325

27,217

Corporate general and administrative

2,449

2,321


2,449

2,321


2,449

2,321

Other operating expense (income), net

94

(1,210)


22

-


94

(1,210)

Impairment of intangible assets

874

1,936


874

1,936


874

1,936

Operating income

6,321

7,712


$        6,299

$        6,223


6,445

8,374

Interest expense

174

252





174

252

Other income

-

(33)





-

(33)

Income tax expense

2,450

3,050





2,501

3,322

Net income 

$        3,697

$      4,443





$        3,770

$        4,833

Earnings per share:









  Basic

$          0.63

$        0.77





$          0.66

$          0.85

  Diluted

$          0.63

$        0.76





$          0.66

$          0.84













Actual


Same Station (1)


Pro Forma (2)



Three Months Ended


Three Months Ended


Three Months Ended



December 31,


December 31,


December 31,



2015

2014


2015

2014


2015

2014

Radio Segment









Net operating revenue

$      29,963

$    30,451


$      28,594

$      29,724


$      30,544

$      32,718

Station operating expense

22,122

22,146


20,847

21,698


22,579

23,751

Other operating expense (income), net

85

(1,210)


13

-


85

(1,210)

Impairment of intangible assets

874

1,936


874

1,936


874

1,936

Operating income

$        6,882

$      7,579


$        6,860

$        6,090


$        7,006

$        8,241























Actual


Same Station (1)


Pro Forma (2)



Three Months Ended


Three Months Ended


Three Months Ended



December 31,


December 31,


December 31,



2015

2014


2015

2014


2015

2014

Television Segment









Net operating revenue

$        5,643

$      5,920


$        5,643

$        5,920


$        5,643

$        5,920

Station operating expense

3,746

3,466


3,746

3,466


3,746

3,466

Other operating expense (income), net

(1)

-


(1)

-


(1)

-

Operating income

$        1,898

$      2,454


$        1,898

$        2,454


$        1,898

$        2,454























Actual


Same Station (1)


Pro Forma (2)



Three Months Ended


Three Months Ended


Three Months Ended



December 31,


December 31,


December 31,



2015

2014


2015

2014


2015

2014

Depreciation and amortization










by segment









Radio Segment

$        1,459

$      1,312


$        1,265

$        1,316


$        1,459

$        1,459

Television Segment

383

370


383

370


383

370

Corporate and Other

56

63


56

63


56

63



$        1,898

$      1,745


$        1,704

$        1,749


$        1,898

$        1,892











(1)

Same station includes only the results of stations we owned and operated for the entire comparable period.




(2)

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





 

Saga Communications, Inc.

Selected Supplemental Financial Data

For the Twelve Months Ended

December 31, 2015 and 2014

(amounts in 000's except per share data)

(Unaudited)













Actual


Same Station (1)


Pro Forma (2)



Twelve Months Ended


Twelve Months Ended


Twelve Months Ended



December 31, 


December 31, 


December 31, 



2015

2014


2015

2014


2015

2014

Consolidated









Net operating revenue

$    132,856

$    133,998


$    130,916

$    131,582


$    139,458

$    143,238

Station operating expense

97,268

98,424


95,484

96,145


102,226

104,912

Corporate general and administrative

10,091

8,901


10,091

8,901


10,091

8,901

Other operating expense (income), net

541

(1,210)


69

-


541

(1,210)

Impairment of intangible assets

874

1,936


874

1,936


874

1,936

Operating income

24,082

25,947


$      24,398

$      24,600


25,726

28,699

Interest expense

888

1,064





888

1,064

Write-off of debt issuance costs

557

-





557

-

Other income

(417)

(71)





(417)

(71)

Income tax expense

9,640

10,050





10,314

11,179

Net income 

$      13,414

$      14,904





$      14,384

$      16,527

Earnings per share:









  Basic

$          2.31

$          2.57





$          2.52

$          2.90

  Diluted

$          2.29

$          2.55





$          2.51

$          2.87













Actual


Same Station (1)


Pro Forma (2)



Twelve Months Ended


Twelve Months Ended


Twelve Months Ended



December 31, 


December 31, 


December 31, 



2015

2014


2015

2014


2015

2014

Radio Segment









Net operating revenue

$    111,792

$    113,627


$    109,852

$    111,211


118,394

122,867

Station operating expense

83,188

85,167


81,404

82,888


88,146

91,655

Other operating expense (income), net

499

(1,210)


27

-


499

(1,210)

Impairment of intangible assets

874

1,936


874

1,936


874

1,936

Operating income

$      27,231

$      27,734


$      27,547

$      26,387


$      28,875

$      30,486























Actual


Same Station (1)


Pro Forma (2)



Twelve Months Ended


Twelve Months Ended


Twelve Months Ended



December 31, 


December 31, 


December 31, 



2015

2014


2015

2014


2015

2014

Television Segment









Net operating revenue

$      21,064

$      20,371


$      21,064

$      20,371


21,064

20,371

Station operating expense

14,080

13,257


14,080

13,257


14,080

13,257

Other operating expense (income), net

32

-


32

-


32

-

Operating income

$        6,952

$        7,114


$        6,952

$        7,114


$        6,952

$        7,114























Actual


Same Station (1)


Pro Forma (2)



Twelve Months Ended


Twelve Months Ended


Twelve Months Ended



December 31, 


December 31, 


December 31, 



2015

2014


2015

2014


2015

2014

Depreciation and amortization










by segment









Radio Segment

$        5,135

$        5,023


$        4,846

$        4,962


$        5,530

$        5,662

Television Segment

1,399

1,411


1,399

1,411


1,399

1,411

Corporate and Other

290

268


290

268


290

268



$        6,824

$        6,702


$        6,535

$        6,641


$        7,219

$        7,341











(1)

Same station includes only the results of stations we owned and operated for the entire comparable period.




(2)

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





 

Saga Communications, Inc.

Selected Supplemental Financial Data

December 31, 2015

(amounts in 000's except ratios)

(Unaudited)






























Twelve Months




Trailing



Ended


Add:


Twelve Months Ended



December 31,


Proforma


December 31,



2015


Acquisitions


2015


2014 (2)

Trailing 12 Month Consolidated Earnings Before Interest








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








Net income

$13,414


$970


$14,384


$14,904

Exclusions:









Gain (loss) on sale of assets

(541)


-


(541)


1,281


Gain on insurance claim

417


-


417


-


Impairment of intangible assets

(874)


-


(874)


(1,936)


Write-off of debt issuance costs

(557)


-


(557)


-


Other

119


-


119


213

Total exclusions

(1,436)


-


(1,436)


(442)










Consolidated adjusted net income (1)

14,850


970


15,820


15,346

Plus:  Interest expense

888


-


888


1,064


Income tax expense

9,640


674


10,314


10,050


Depreciation & amortization expense

6,824


395


7,219


6,702


Amortization of television syndicated programming contracts

637


-


637


637


Non-cash stock based compensation expense

1,655


-


1,655


826

Less: Cash television programming payments

(635)


-


(635)


(627)

Trailing twelve month consolidated EBITDA (1)

$33,859


$2,039


$35,898


$33,998










Total long-term debt, including current maturities





$36,365


$36,078

Divided by trailing twelve month consolidated EBITDA (1)





35,898


33,998

Leverage ratio





1.0


1.1



















(1)

As defined in the Company's credit facility.








(2)

December 31, 2014 did not include any proforma acquisitions







 


Saga Communications, Inc.


Selected Financial Data Non-GAAP Disclosures


For the Three Months Ended


December 31, 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



December 31,


Entire Comparable


December 31,


December 31,


Entire Comparable


December 31,



2015


Period


2015


2014


Period


2014

Consolidated












Net operating revenue

$              35,606


$              (1,369)


$              34,237


$              36,371


$                 (727)


$              35,644

Station operating expense

25,868


(1,275)


24,593


25,612


(448)


25,164

Corporate general and administrative

2,449


-


2,449


2,321


-


2,321

Other operating expense (income), net

94


(72)


22


(1,210)


1,210


-

Impairment of intangible assets

874


-


874


1,936


-


1,936

Operating income

$                6,321


$                   (22)


$                6,299


$                7,712


$              (1,489)


$                6,223














Depreciation and amortization

$                1,898


$                 (194)


$                1,704


$                1,745


$                      4


$                1,749


















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



December 31,


Entire Comparable


December 31,


December 31,


Entire Comparable


December 31,



2015


Period


2015


2014


Period


2014

Radio Segment












Net operating revenue

$              29,963


$              (1,369)


$              28,594


$              30,451


$                 (727)


$              29,724

Station operating expense

22,122


(1,275)


20,847


22,146


(448)


21,698

Other operating expense (income), net

85


(72)


13


(1,210)


1,210


-

Impairment of intangible assets

874


-


874


1,936


-


1,936

Operating income

$                6,882


$                   (22)


$                6,860


$                7,579


$              (1,489)


$                6,090














Depreciation and amortization

$                1,459


$                 (194)


$                1,265


$                1,312


$                      4


$                1,316


















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



December 31,


Entire Comparable


December 31,


December 31,


Entire Comparable


December 31,



2015


Period


2015


2014


Period


2014

Television Segment












Net operating revenue

$                5,643


$                     -


$                5,643


$                5,920


$                     -


$                5,920

Station operating expense

3,746


-


3,746


3,466


-


3,466

Other operating expense (income), net

(1)


-


(1)


-


-


-

Operating income

$                1,898


$                     -


$                1,898


$                2,454


$                     -


$                2,454














Depreciation and amortization

$                   383


$                     -


$                   383


$                   370


$                     -


$                   370

 


Saga Communications, Inc.


Selected Financial Data Non-GAAP Disclosures


For the Twelve Months Ended


December 31, 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




Twelve Months


and Dispositions


Twelve Months


Twelve Months


and Dispositions


Twelve Months




Ended


Not Included in 


Ended


Ended


Not Included in 


Ended




December 31,


Entire Comparable


December 31,


December 31,


Entire Comparable


December 31,




2015


Period


2015


2014


Period


2014


Consolidated













Net operating revenue

$            132,856


$              (1,940)


$            130,916


$            133,998


$              (2,416)


$            131,582


Station operating expense

97,268


(1,784)


95,484


98,424


(2,279)


96,145


Corporate general and administrative

10,091


-


10,091


8,901


-


8,901


Other operating expense (income), net

541


(472)


69


(1,210)


1,210


-


Impairment of intangible assets

874


-


874


1,936


-


1,936


Operating income

$              24,082


$                  316


$              24,398


$              25,947


$              (1,347)


$              24,600
















Depreciation and amortization

$                6,824


$                 (289)


$                6,535


$                6,702


$                   (61)


$                6,641




















Adjustment






Adjustment






Actual


For Acquisitions


Same Station


Actual


For Acquisitions


Same Station




Twelve Months


and Dispositions


Twelve Months


Twelve Months


and Dispositions


Twelve Months




Ended


Not Included in 


Ended


Ended


Not Included in 


Ended




December 31,


Entire Comparable


December 31,


December 31,


Entire Comparable


December 31,




2015


Period


2015


2014


Period


2014


Radio Segment













Net operating revenue

$            111,792


$              (1,940)


$            109,852


$            113,627


$              (2,416)


$            111,211


Station operating expense

83,188


(1,784)


81,404


85,167


(2,279)


82,888


Other operating expense (income), net

499


(472)


27


(1,210)


1,210


-


Impairment of intangible assets

874


-


874


1,936


-


1,936


Operating income

$              27,231


$                  316


$              27,547


$              27,734


$              (1,347)


$              26,387
















Depreciation and amortization

$                5,135


$                 (289)


$                4,846


$                5,023


$                   (61)


$                4,962




















Adjustment






Adjustment






Actual


For Acquisitions


Same Station


Actual


For Acquisitions


Same Station




Twelve Months


and Dispositions


Twelve Months


Twelve Months


and Dispositions


Twelve Months




Ended


Not Included in 


Ended


Ended


Not Included in 


Ended




December 31,


Entire Comparable


December 31,


December 31,


Entire Comparable


December 31,




2015


Period


2015


2014


Period


2014


Television Segment













Net operating revenue

$              21,064


$                     -


$              21,064


$              20,371


$                     -


$              20,371


Station operating expense

14,080


-


14,080


13,257


-


13,257


Other operating expense (income), net

32


-


32


-


-


-


Operating income

$                6,952


$                     -


$                6,952


$                7,114


$                     -


$                7,114
















Depreciation and amortization

$                1,399


$                     -


$                1,399


$                1,411


$                     -


$                1,411


 

 

 

SOURCE Saga Communications, Inc.



RELATED LINKS

http://www.sagacommunications.com