Emmis Announces First Quarter Earnings

INDIANAPOLIS, July 12, 2018 /PRNewswire/ — Emmis Communications Corporation (NASDAQ: EMMS) today announced results for its first fiscal quarter ending May 31, 2018.

Emmis’ radio net revenues for the first fiscal quarter were $26.4 million, down from $38.7 million in the prior year. Pro forma for all radio station sales, Emmis’ first quarter radio revenues as reported to Miller Kaplan, which excludes barter revenues and syndication revenues, were down 4% in markets that were down 6%.

On April 30, the company finalized the sale of its St. Louis radio stations and used the net proceeds to repay credit facility debt, resulting in approximately $20 million of net credit facility debt outstanding.

“Emmis has made tremendous strides in paying down our debt and giving ourselves the financial flexibility to pursue new areas of growth,” Jeff Smulyan, CEO & Chairman of the Board of Emmis said. “We see opportunities both inside and outside of traditional media as we look to transform the company in the coming months and years.”  

A conference call regarding earnings will be hosted today at 9 a.m. Eastern today by dialing 1-517-623-4891.  Questions may be submitted via email to ir@emmis.com. A digital playback of the call will be available until Thursday, July 19 by dialing 1-402-220-5339.

Emmis has included supplemental pro forma net revenues, station operating expenses, and certain other financial data on its website, www.emmis.com under the “Investors” tab.

Emmis generally evaluates the performance of its operating entities based on station operating income. Management believes that station operating income is useful to investors because it provides a meaningful comparison of operating performance between companies in the industry and serves as an indicator of the market value of a group of stations or publishing entities. Station operating income is generally recognized by the broadcast and publishing industries as a measure of performance and is used by analysts who report on the performance of broadcasting and publishing groups. Station operating income does not take into account Emmis’ debt service requirements and other commitments, and, accordingly, station operating income is not necessarily indicative of amounts that may be available for dividends, reinvestment in Emmis’ business or other discretionary uses.

Station operating income is not a measure of liquidity or of performance, in accordance with accounting principles generally accepted in the United States, and should be viewed as a supplement to, and not a substitute for, our results of operations presented on the basis of accounting principles generally accepted in the United States. Operating Income is the most directly comparable financial measure in accordance with accounting principles generally accepted in the United States. 

Moreover, station operating income is not a standardized measure and may be calculated in a number of ways. Emmis defines station operating income as revenues net of agency commissions and station operating expenses, excluding depreciation, amortization and non-cash compensation.  A reconciliation of station operating income to operating income is attached to this press release. 

The information in this news release is being widely disseminated in accordance with the Securities & Exchange Commission’s Regulation FD.

About Emmis Communications
Emmis Communications Corporation (Nasdaq: EMMS) owns 11 FM and 3 AM radio stations in New York, Austin (Emmis has a 50.1% controlling interest in Emmis’ 6 radio stations located there) and Indianapolis. Emmis developed and licenses TagStation®, developed NextRadio®, a smartphone application that marries over-the-air FM radio broadcasts with visual and interactive features on smartphones, and developed the DialReport®, a data attribution platform for the radio industry.  Emmis also owns a controlling interest in Digonex, which provides dynamic pricing solutions across multiple industries. 

Note: Certain statements included in this press release which are not statements of historical fact, including but not limited to those identified with the words “expect,” “will” or “look” are intended to be, and are, by this Note, identified as “forward-looking statements,” as defined in the Securities and Exchange Act of 1934, as amended. Such statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from any future result, performance or achievement expressed or implied by such forward-looking statement. Such factors include, among others:

  • general economic and business conditions;
  • fluctuations in the demand for advertising and demand for different types of advertising media;
  • our ability to service our outstanding debt;
  • competition from new or different media and technologies;
  • loss of key personnel;
  • increased competition in our markets and the broadcasting industry, including our competitors changing the format of a station they operate to more directly compete with a station we operate in the same market;
  • our ability to attract and secure programming, on-air talent, writers and photographers;
  • inability to obtain (or to obtain timely) necessary approvals for purchase or sale transactions or to complete the transactions for other reasons generally beyond our control;
  • increases in the costs of programming, including on-air talent;
  • fluctuations in the market price of publicly traded or other securities;
  • new or changing regulations of the Federal Communications Commission or other governmental agencies;
  • enforcement of rules and regulations of governmental and other entities to which the Company is subject;
  • changes in radio audience measurement methodologies;
  • war, terrorist acts or political instability; and
  • other factors mentioned in documents filed by the Company with the Securities and Exchange Commission.

Emmis does not undertake any obligation to publicly update or revise any forward-looking statements because of new information, future events or otherwise

EMMIS COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED FINANCIAL DATA

(Unaudited, amounts in thousands, except per share data)

Three months ended May 31,

2018

2017

OPERATING DATA:

  Net revenues:

    Radio

$                     26,384

$                    38,706

    Publishing

1,273

1,144

    Emerging Technologies

349

314

      Total net revenues

28,006

40,164

  Station operating expenses excluding

   depreciation and amortization expense:

    Radio

17,693

26,134

    Publishing

1,199

1,355

    Emerging Technologies

2,639

3,741

      Total station operating expenses excluding 

          depreciation and amortization expense 

21,531

31,230

  Corporate expenses excluding depreciation 

       and amortization expense

2,508

2,743

  Depreciation and amortization

799

978

  Gain on sale of assets, net of disposition costs

(32,067)

  Operating income

35,235

5,213

  Interest expense

(2,641)

(4,666)

  Loss on debt extinguishment 

(771)

  Other income, net

16

3

  Income before income taxes

31,839

550

  Provision (benefit) for income taxes

7,600

(22)

  Consolidated net income

24,239

572

  Net income attributable to noncontrolling interests

754

839

  Net income (loss) attributable to the Company

23,485

(267)

     Basic net income (loss) per common share

$                          1.88

$                       (0.02)

     Diluted net income (loss) per common share

$                          1.75

$                       (0.02)

     Basic weighted average shares outstanding

12,483

12,257

     Diluted weighted average shares outstanding

13,411

12,257

OTHER DATA:

  Station operating income (See below)

$                       6,546

$                      9,083

  Cash paid for income taxes, net

369

153

  Cash paid for interest

2,043

3,399

  Capital expenditures

20

397

 Noncash compensation by segment:

           Radio

$                             47

$                         125

           Publishing

1

2

           Emerging Technologies

23

22

           Corporate

392

540

                  Total

$                           463

$                         689

COMPUTATION OF STATION OPERATING INCOME (LOSS):

  Operating income

$                     35,235

$                      5,213

  Plus:  Depreciation and amortization

799

978

  Plus:  Corporate expenses

2,508

2,743

  Plus:  Station noncash compensation

71

149

  Plus/(less):  Loss/(gain) on sale of assets, net of disposition costs

(32,067)

  Station operating income (loss)

$                       6,546

$                      9,083

SELECTED BALANCE SHEET INFORMATION:

May 31, 2018

February 28, 2018

Total Cash and Cash Equivalents

$                     10,456

$                      4,107

Credit Agreement Debt

$                     28,000

$                    78,451

98.7FM Nonrecourse Debt

$                     52,337

$                    53,919

Other Nonrecourse Debt

$                     10,012

$                      9,992

 

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SOURCE Emmis Communications Corporation

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