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      Entravision Communications Corporation Reports Second Quarter 2010 Results


      News provided by

      Entravision Communications Corporation

      Aug 05, 2010, 04:05 ET

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      SANTA MONICA, Calif., Aug. 5 /PRNewswire-FirstCall/ -- Entravision Communications Corporation (NYSE: EVC) today reported financial results for the three- and six-month periods ended June 30, 2010.

      Historical results, which are attached, are in thousands of U.S. dollars (except share and per share data).  This press release contains certain non-GAAP financial measures as defined by SEC Regulation G.  The GAAP financial measure most directly comparable to each of these non-GAAP financial measures, and a table reconciling each of these non-GAAP financial measures to its most directly comparable GAAP financial measure, is included beginning on page 8.  Unaudited financial highlights are as follows:



      Three-Month Period


      Six-Month Period



      Ended June 30,


      Ended June 30,



      2010


      2009


      % Change


      2010


      2009


      % Change

      Net revenue

      $      53,431


      $      48,696


      10%


      $      96,504


      $      90,411


      7%

      Operating expenses (1)

      31,097


      29,646


      5%


      60,921


      61,459


      (1)%

      Corporate expenses (2)

      3,477


      3,378


      3%


      7,225


      7,251


      (0)%














      Consolidated adjusted EBITDA (3)

      18,966


      16,323


      16%


      28,494


      23,039


      24%














      Free cash flow (4)

      $        7,134


      $        5,217


      37%


      $        4,534


      $        4,118


      10%

      Free cash flow per share, basic and diluted (4)

      $          0.08


      $          0.06


      33%


      $          0.05


      $          0.05


      0%














      Net income (loss) applicable to common stockholders

      $        6,963


      $      (1,827)


      NM


      $        4,779


      $    (16,321)


      NM














      Net income (loss) per share applicable to common stockholders, basic and diluted

      $          0.08


      $        (0.02)


      NM


      $          0.06


      $        (0.19)


      NM














      Weighted average common shares outstanding, basic

      84,494,665


      84,187,128




      84,462,613


      84,235,509



      Weighted average common shares outstanding, diluted

      85,373,021


      84,187,128




      85,278,162


      84,235,509















      (1)  Operating expenses include direct operating, selling, general and administrative expenses. Included in operating
      expenses are $0.2 million and $0.4 million of non-cash stock-based compensation for the three-month periods ended
      June 30, 2010 and 2009, respectively and $0.5 million and $0.7 million of non-cash stock-based compensation for the
      six-month periods ended June 30, 2010 and 2009, respectively. Operating expenses do not include corporate expenses,
      depreciation and amortization, impairment charge, gain (loss) on sale of assets and gain (loss) on debt extinguishment.

      (2)  Corporate expenses include $0.3 million and $0.4 million of non-cash stock-based compensation for the three-month
      periods ended June 30, 2010 and 2009, respectively and $0.5 million  and $0.8 million of non-cash stock-based compensation
      for the six-month periods ended June 30, 2010 and 2009, respectively.

      (3)  Consolidated adjusted EBITDA means net income (loss) plus gain (loss) on sale of assets, depreciation and amortization,
      non-cash impairment charge, non-cash stock-based  compensation included in operating and corporate expenses,
      net interest expense, gain (loss) on debt extinguishment, income tax (expense) benefit, equity in net income (loss) of
      nonconsolidated affiliate and syndication programming amortization less syndication programming payments. We use
      the term consolidated adjusted EBITDA because that measure is defined in our syndicated bank credit facility and does
      not include gain (loss) on sale of assets, depreciation and amortization, non-cash impairment charge, non-cash stock-based
      compensation, net interest expense, gain (loss) on debt extinguishment, income tax (expense) benefit, equity in net income
      (loss) of nonconsolidated affiliate and syndication programming  amortization and does include syndication programming
      payments. While many in the financial community and we consider consolidated adjusted EBITDA to be important, it 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 accounting principles generally accepted in the United States of America, such as cash
      flows from operating activities, operating income and net income.  As consolidated adjusted EBITDA excludes non-cash gain
      (loss) on sale of assets, non-cash depreciation and amortization, non-cash impairment charge, non-cash stock-based
      compensation expense, net interest expense, gain (loss) on debt  extinguishment, income tax (expense) benefit, equity
      in net income (loss) of nonconsolidated affiliate and syndication programming amortization and includes syndication programming
      payments, consolidated adjusted EBITDA has certain limitations because it excludes and includes several important non-cash
      financial line items. Therefore, we consider both non-GAAP and GAAP measures when evaluating our business.  Consolidated
      adjusted EBITDA is also used to make executive compensation decisions.  

      (4)  Free cash flow is defined as consolidated adjusted EBITDA less cash paid for income taxes, net interest expense and
      capital expenditures. Net interest expense is defined as interest  expense, less non-cash interest expense relating to
      amortization of debt finance costs, less interest income and less the change in the fair value of our interest rate swaps. Free cash
      flow per share is defined as free cash flow divided by the basic or diluted weighted average common shares outstanding.




      Commenting on the Company's earnings results, Walter F. Ulloa, Chairman and Chief Executive Officer, said, "During the second quarter, we generated solid revenue growth, primarily driven by World Cup advertising and retransmission consent revenue.  Our audience shares remain strong in the nation's most densely populated Hispanic markets, and we believe that our U.S. Hispanic audience will continue to grow.  In addition, our recently-completed bond offering and new revolving credit facility extend the maturity of our debt and provide additional financial flexibility as we continue to seek to enhance shareholder value."

      Senior Secured Notes and Revolving Credit Facility

      On July 27, 2010, the Company completed the offering and sale of $400,000,000 aggregate principal amount of its 8.75% Senior Secured First Lien Notes (the "Notes").  The Notes were issued at a discount of 98.722% of their principal amount and will mature on August 1, 2017.  Interest on the Notes accrues at a rate of 8.75% per annum from the date of original issuance and is payable semi-annually in arrears on February 1 and August 1 of each year, commencing on February 1, 2011.  The Notes are guaranteed on a senior secured basis by all of the Company's existing and future wholly-owned domestic subsidiaries.  Net proceeds from the Notes were used to pay all indebtedness outstanding under the Company's syndicated bank credit facility, pay fees and expenses related to the offering of the Notes and for general corporate purposes.

      On July 27, 2010, the Company also entered into a new $50,000,000 revolving credit facility (the "Revolving Credit Facility") and terminated the then-existing syndicated bank credit facility.  The Revolving Credit Facility expires on July 27, 2013 and is guaranteed on a senior secured basis by all of the Company's existing and future wholly-owned domestic subsidiaries, which are also the guarantors of the Notes.  To date, the Company has not drawn any part of the Revolving Credit Facility.

      These transactions are more fully described in the Company's Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission on July 27, 2010.

      Financial Results


      Three Months Ended June 30, 2010 Compared to Three Months Ended June 30, 2009

      (Unaudited)



      Three-Month Period



      Ended June 30,



      2010


      2009


      % Change

      Net revenue

      $      53,431


      $      48,696


      10%

      Operating expenses (1)

      31,097


      29,646


      5%

      Corporate expenses (1)

      3,477


      3,378


      3%

      Depreciation and amortization

      4,874


      5,191


      (6)%

      Impairment charge

      -


      2,720


      NM








      Operating income

      13,983


      7,761


      80%

      Interest expense, net

      (5,179)


      (8,404)


      (38)%








      Income (loss) before income taxes

      8,804


      (643)


      NM








      Income tax expense

      (1,928)


      (1,099)


      75%

      Net income (loss) before equity in net income (loss) of nonconsolidated affiliates

      6,876


      (1,742)


      NM

      Equity in net income (loss) of nonconsolidated affiliates, net of tax

      87


      (85)


      NM








      Net income (loss)

      $        6,963


      $      (1,827)


      NM







      (1)  Operating expenses and corporate expenses are defined on page 1.




      Net revenue increased to $53.4 million for the three-month period ended June 30, 2010 from $48.7 million for the three-month period ended June 30, 2009, an increase of $4.7 million. Of the overall increase, $3.1 million came from our television segment and was primarily attributable to advertising revenue from the World Cup and census and retransmission consent revenue. Additionally, $1.6 million of the overall increase came from our radio segment and was primarily attributable to advertising revenue from the World Cup.

      Operating expenses increased to $31.1 million for the three-month period ended June 30, 2010 from $29.6 million for the three-month period ended June 30, 2009, an increase of $1.5 million. The increase was primarily attributable to an increase in national representation fees and other expenses associated with the increase in net revenue.

      Corporate expenses increased to $3.5 million for the three-month period ended June 30, 2010 from $3.4 million for the three-month period ended June 30, 2009, an increase of $0.1 million. The increase was attributable to an increase in professional fees.

      Six Months Ended June 30, 2010 Compared to Six Months Ended June 30, 2009

      (Unaudited)



      Six-Month Period



      Ended June 30,



      2010


      2009


      % Change

      Net revenue

      $      96,504


      $      90,411


      7%

      Operating expenses (1)

      60,921


      61,459


      (1)%

      Corporate expenses (1)

      7,225


      7,251


      (0)%

      Depreciation and amortization

      9,597


      10,621


      (10)%

      Impairment charge

      -


      2,720


      NM








      Operating income

      18,761


      8,360


      124%

      Interest expense, net

      (10,610)


      (13,217)


      (20)%

      Loss on debt extinguishment

      -


      (4,716)


      NM








      Income (loss) before income taxes

      8,151


      (9,573)


      NM








      Income tax expense

      (3,338)


      (6,509)


      (49)%

      Net income (loss) before equity in net loss of nonconsolidated affiliates

      4,813


      (16,082)


      NM

      Equity in net loss of nonconsolidated affiliates, net of tax

      (34)


      (239)


      (86)%








      Net income (loss)

      $        4,779


      $    (16,321)


      NM







      (1)  Operating expenses and corporate expenses are defined on page 1.




      Net revenue increased to $96.5 million for the six-month period ended June 30, 2010 from $90.4 million for the six-month period ended June 30, 2009, an increase of $6.1 million. Of the overall increase, $4.5 million came from our television segment and was primarily attributable to advertising revenue from the World Cup, retransmission consent revenue and political and census advertising revenue. Additionally, $1.6 million of the overall increase came from our radio segment and was primarily attributable to advertising revenue from the World Cup and census.

      Operating expenses decreased to $60.9 million for the six-month period ended June 30, 2010 from $61.5 million for the six-month period ended June 30, 2009, a decrease of $0.6 million. The decrease was primarily attributable to a decrease in salary expense due to reductions of personnel and salary reductions implemented in 2009, partially offset by an increase in national representation fees and other expenses associated with the increase in net revenue.

      Corporate expenses decreased to $7.2 million for the six-month period ended June 30, 2010 from $7.3 million for the six-month period ended June 30, 2009, a decrease of $0.1 million. The decrease was attributable to a decrease in non-cash stock-based compensation of $0.3 million, partially offset by an increase in professional fees.

      Segment Results


      The following represents selected unaudited segment information:





      Three-Month Period




      Ended June 30,




      2010


      2009


      % Change

      Net Revenue







      Television

      $ 34,819


      $ 31,746


      10%


      Radio

      18,612


      16,950


      10%



      Total

      $ 53,431


      $ 48,696


      10%









      Operating Expenses (1)







      Television

      $ 18,904


      $ 18,107


      4%


      Radio

      12,193


      11,539


      6%



      Total

      $ 31,097


      $ 29,646


      5%









      Corporate Expenses (1)

      $   3,477


      $   3,378


      3%









      Consolidated adjusted EBITDA (1)

      $ 18,966


      $ 16,323


      16%







      (1)  Operating expenses, Corporate expenses, and Consolidated adjusted EBITDA are defined on page 1.




      Entravision Communications Corporation will hold a conference call to discuss its 2010 second quarter results on August 5, 2010 at 5 p.m. Eastern Time.  To access the conference call, please dial 412-858-4600 ten minutes prior to the start time.  The call will be webcast live and archived for replay at www.entravision.com.

      Entravision Communications Corporation is a diversified Spanish-language media company utilizing a combination of television and radio operations to reach Hispanic consumers across the United States, as well as the border markets of Mexico.  Entravision owns and/or operates 53 primary television stations and is the largest affiliate group of both the top-ranked Univision television network and Univision's TeleFutura network, with television stations in 20 of the nation's top 50 Hispanic markets.  The Company also operates one of the nation's largest groups of primarily Spanish-language radio stations, consisting of 48 owned and operated radio stations.  Entravision shares of Class A Common Stock are traded on The New York Stock Exchange under the symbol: EVC.

      This press release contains certain forward-looking statements.  These forward-looking statements, which are included in accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, may involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results and performance in future periods to be materially different from any future results or performance suggested by the forward-looking statements in this press release.  Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that actual results will not differ materially from these expectations, and the Company disclaims any duty to update any forward-looking statements made by the Company. From time to time, these risks, uncertainties and other factors are discussed in the Company's filings with the Securities and Exchange Commission.

      (Financial Table Follows)



      Entravision Communications Corporation

      Consolidated Statements of Operations

      (In thousands, except share and per share data)

      (Unaudited)





      Three-Month Period


      Six-Month Period




      Ended June 30,


      Ended June 30,




      2010


      2009


      2010


      2009











      Net revenue

      $      53,431


      $      48,696


      $      96,504


      $      90,411











      Expenses:









      Direct operating expenses (including related parties of $3,151, $2,004, $5,502 and $3,731)  (including non-cash stock-based compensation of $103, $164, $208 and $330)

      22,162


      20,799


      42,930


      42,660


      Selling, general and administrative expenses (including non-cash stock-based compensation of $147, $207, $295 and $414)

      8,935


      8,847


      17,991


      18,799










      Corporate expenses (including non-cash stock-based compensation of $286, $353, $492 and $759)

      3,477


      3,378


      7,225


      7,251










      Depreciation and amortization (includes direct operating of $3,385, $3,843, $6,874 and $7,918; selling, general and administrative of $903, $1,068, $1,841 and $2,089; and corporate of $586, $280, $883 and $614) (including related parties of $846, $580, $1,426 and $1,160)

      4,874


      5,191


      9,597


      10,621


































      Impairment charge

      -


      2,720


      -


      2,720




      39,448


      40,935


      77,743


      82,051



      Operating income

      13,983


      7,761


      18,761


      8,360

      Interest expense (including related parties of $25, $29, $54 and $60)

      (5,263)


      (8,474)


      (10,777)


      (13,535)

      Interest income

      84


      70


      167


      318

      Loss on debt extinguishment

      -


      -


      -


      (4,716)



      Income (loss) before income taxes

      8,804


      (643)


      8,151


      (9,573)

      Income tax expense

      (1,928)


      (1,099)


      (3,338)


      (6,509)



      Income (loss) before equity in net income (loss) of nonconsolidated affiliate

      6,876


      (1,742)


      4,813


      (16,082)

      Equity in net income (loss) of nonconsolidated affiliate, net of tax

      87


      (85)


      (34)


      (239)

      Net income (loss) applicable to common stockholders

      $        6,963


      $      (1,827)


      $        4,779


      $    (16,321)











      Basic and diluted earnings per share:








      Net income (loss) per share applicable to common stockholders,









      basic and diluted

      $          0.08


      $        (0.02)


      $          0.06


      $        (0.19)





















      Weighted average common shares outstanding, basic

      84,494,665


      84,187,128


      84,462,613


      84,235,509

      Weighted average common shares outstanding, diluted

      85,373,021


      84,187,128


      85,278,162


      84,235,509



      Entravision Communications Corporation

      Consolidated Statements of Cash Flows

      (Unaudited; in thousands)







      Three-Month Period


      Six-Month Period






      Ended June 30,


      Ended June 30,






      2010


      2009


      2010


      2009

























      Cash flows from operating activities:









      Net income (loss)

      $   6,963


      $ (1,827)


      $   4,779


      $ (16,321)


      Adjustments to reconcile net income (loss) to net cash provided by operating activities:










      Depreciation and amortization

      4,874


      5,191


      9,597


      10,621



      Impairment charge

      -


      2,720


      -


      2,720



      Deferred income taxes

      1,414


      486


      2,627


      5,986



      Amortization of debt issue costs

      104


      105


      208


      194



      Amortization of syndication contracts

      278


      627


      550


      1,248



      Payments on syndication contracts

      (705)


      (700)


      (1,409)


      (1,413)



      Equity in net (income) loss of nonconsolidated affiliate

      (87)


      85


      34


      239



      Non-cash stock-based compensation

      536


      724


      995


      1,503



      Gain on sale of media properties and other assets

      -


      (2)


      -


      (102)



      Non-cash expenses related to debt extinguishment

      -


      -


      -


      945



      Change in fair value of interest rate swap agreements

      (4,123)


      (855)


      (8,053)


      (2,536)



      Changes in assets and liabilities, net of effect of acquisitions and dispositions:











      Increase in accounts receivable

      (8,665)


      (5,591)


      (3,625)


      (1,272)




      Decrease in prepaid expenses and other assets

      140


      51


      48


      189




      Increase in accounts payable, accrued expenses and other liabilities

      3,339


      2,905


      3,451


      2,102





      Net cash provided by operating activities

      4,068


      3,919


      9,202


      4,103

      Cash flows from investing activities:









      Proceeds from sale of property and equipment and intangibles

      -


      14


      -


      114


      Purchases of property and equipment and intangibles

      (3,371)


      (1,339)


      (6,045)


      (6,618)





      Net cash used in investing activities

      (3,371)


      (1,325)


      (6,045)


      (6,504)

      Cash flows from financing activities:









      Proceeds from issuance of common stock

      69


      -


      219


      202


      Payments on long-term debt

      (1,000)


      -


      (4,458)


      (41,000)


      Repurchase of Class A common stock

      -


      (532)


      -


      (1,075)


      Payments of deferred debt and offering costs

      (501)


      -


      (863)


      (1,182)





      Net cash used in financing activities

      (1,432)


      (532)


      (5,102)


      (43,055)





      Net increase (decrease) in cash and cash equivalents

      (735)


      2,062


      (1,945)


      (45,456)

      Cash and cash equivalents:









      Beginning


      26,456


      16,776


      27,666


      64,294


      Ending



      $ 25,721


      $ 18,838


      $ 25,721


      $  18,838



      Entravision Communications Corporation

      Reconciliation of Consolidated Adjusted EBITDA to
      Cash Flows From Operating Activities

      (Unaudited; in thousands)


      The most directly comparable GAAP financial measure is operating cash flow. A reconciliation of this non-GAAP
      measure to cash flows from operating activities for each of the periods presented is as follows:




      Three-Month Period


      Six-Month Period



      Ended June 30,


      Ended June 30,



      2010


      2009


      2010


      2009




























      Consolidated adjusted EBITDA (1)

      $ 18,966


      $ 16,323


      $ 28,494


      $ 23,039










      Interest expense

      (5,263)


      (8,474)


      (10,777)


      (13,535)

      Interest income

      84


      70


      167


      318

      Loss on debt extinguishment

      -


      -


      -


      (4,716)

      Income tax expense

      (1,928)


      (1,099)


      (3,338)


      (6,509)

      Amortization of syndication contracts

      (278)


      (627)


      (550)


      (1,248)

      Payments on syndication contracts

      705


      700


      1,409


      1,413

      Non-cash stock-based compensation included in direct operating









      expenses

      (103)


      (164)


      (208)


      (330)

      Non-cash stock-based compensation included in selling, general









      and administrative expenses

      (147)


      (207)


      (295)


      (414)

      Non-cash stock-based compensation included in corporate expenses

      (286)


      (353)


      (492)


      (759)

      Depreciation and amortization

      (4,874)


      (5,191)


      (9,597)


      (10,621)

      Impairment charge

      -


      (2,720)


      -


      (2,720)

      Equity in net income (loss) of nonconsolidated affiliates

      87


      (85)


      (34)


      (239)

      Net income (loss)

      6,963


      (1,827)


      4,779


      (16,321)



















      Depreciation and amortization

      4,874


      5,191


      9,597


      10,621

      Impairment charge

      -


      2,720


      -


      2,720

      Deferred income taxes

      1,414


      486


      2,627


      5,986

      Amortization of debt issue costs

      104


      105


      208


      194

      Amortization of syndication contracts

      278


      627


      550


      1,248

      Payments on syndication contracts

      (705)


      (700)


      (1,409)


      (1,413)

      Equity in net (income) loss of nonconsolidated affiliate

      (87)


      85


      34


      239

      Non-cash stock-based compensation

      536


      724


      995


      1,503

      Gain on sale of media properties and other assets

      -


      (2)


      -


      (102)

      Non-cash expenses related to debt extinguishment

      -


      -


      -


      945

      Change in fair value of interest rate swap agreements

      (4,123)


      (855)


      (8,053)


      (2,536)

      Changes in assets and liabilities, net of effect of acquisitions and dispositions:









      Increase in accounts receivable

      (8,665)


      (5,591)


      (3,625)


      (1,272)


      Decrease in prepaid expenses and other assets

      140


      51


      48


      189


      Increase in accounts payable, accrued expenses and other liabilities

      3,339


      2,905


      3,451


      2,102

      Cash flows from operating activities

      $   4,068


      $   3,919


      $   9,202


      $   4,103









      (1)   Consolidated adjusted EBITDA is defined on page 1.




      Entravision Communications Corporation

      Reconciliation of Free Cash Flow to Net Income (Loss)

      (Unaudited; in thousands)


      The most directly comparable GAAP financial measure is net income (loss). A reconciliation of this non-GAAP measure to net income (loss) for each of the periods presented is as follows:




      Three-Month Period


      Six-Month Period



      Ended June 30,


      Ended June 30,



      2010


      2009


      2010


      2009

      Consolidated adjusted EBITDA (1)

      $ 18,966


      $ 16,323


      $ 28,494


      $  23,039

      Net interest expense (1)

      9,197


      9,154


      18,454


      15,559

      Cash paid for income taxes

      514


      613


      711


      523

      Capital expenditures (2)

      2,121


      1,339


      4,795


      2,839

      Free cash flow (1)

      7,134


      5,217


      4,534


      4,118










      Capital expenditures (2)

      2,121


      1,339


      4,795


      2,839

      Non-cash interest expense relating to amortization of debt









      finance costs and interest rate swap agreements

      4,018


      750


      7,844


      2,342

      Loss on debt extinguishment

      -


      -


      -


      (4,716)

      Non-cash income tax expense

      (1,414)


      (486)


      (2,627)


      (5,986)

      Amortization of syndication contracts

      (278)


      (627)


      (550)


      (1,248)

      Payments on syndication contracts

      705


      700


      1,409


      1,413

      Non-cash stock-based compensation included in direct operating









      expenses

      (103)


      (164)


      (208)


      (330)

      Non-cash stock-based compensation included in selling, general









      and administrative expenses

      (147)


      (207)


      (295)


      (414)

      Non-cash stock-based compensation included in corporate expenses

      (286)


      (353)


      (492)


      (759)

      Depreciation and amortization

      (4,874)


      (5,191)


      (9,597)


      (10,621)

      Impairment charge

      -


      (2,720)


      -


      (2,720)

      Equity in net income (loss) of nonconsolidated affiliates

      87


      (85)


      (34)


      (239)

      Net income (loss)

      $   6,963


      $ (1,827)


      $   4,779


      $ (16,321)









      (1)  Consolidated adjusted EBITDA, net interest expense and free cash flow are defined on page 1.

      (2)  Capital expenditures is not part of the consolidated statement of operations.




      SOURCE Entravision Communications Corporation

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