EX-99.1 2 d220512dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO

 

For Immediate Release

July 27, 2016

     

Contact: Steve Fisher

Executive Vice President

and CFO, Entercom

(610) 660-5647

sfisher@entercom.com

ENTERCOM COMMUNICATIONS CORP.

REPORTS SECOND QUARTER RESULTS

Free Cash Flow Increased 47%

Bala Cynwyd, PA - Entercom Communications (NYSE:ETM) today reported financial results for the quarter ended June 30, 2016.

Second Quarter Highlights

 

    Net revenues for the quarter increased 20% to $120.5 million

 

    Station expenses increased 18% to $82.3 million

 

    Station operating income increased 23% to $38.2 million

 

    Adjusted EBITDA increased 21% to $30.9 million

 

    Adjusted net income per share increased 27% to $0.28

 

    Free cash flow increased 47% to $20.9 million

David J. Field, President and Chief Executive Officer, stated: “I am pleased to report that Entercom had another outstanding quarter as pro forma Revenue grew 5%, Adjusted EBITDA increased 21% and Free Cash Flow grew 47%. Entercom continues to deliver strong and consistent organic top line and bottom line growth driven by the great work of our talented programming and sales teams and our strategic investments in building powerful local brands and content and excellent customer marketing capabilities. Looking forward, we expect a strong second half of the year as we benefit from our excellent ratings performance, enhanced sales execution, multiple growth initiatives and election year political revenue.”

Second quarter operating results include the impact of the transaction with Lincoln Financial Media and the station exchange with Bonneville International Corporation which started in July 2015.


Additional Information

The Company’s Board of Directors has declared a dividend of $0.075 per share which will be payable on September 15, 2016 to shareholders of record as of the close of business on August 15, 2016.

As of June 30, 2016 the Company had $465.5 million of senior debt, capital leases and senior notes and $11.1 million in cash. In addition, the Company had $27.6 million in perpetual cumulative convertible preferred stock.

Earnings Conference Call and Company Information

Entercom will hold a conference call regarding the quarterly earnings release on Wednesday July 27, 2016 at 10:00 AM Eastern Time. Investors will have the opportunity to submit questions to the Company regarding the earnings release by emailing their inquiries to questions@entercom.com. Questions should be sent at least 10 minutes prior to the call. The Company will only discuss inquiries made by email prior to the conference call. The public may access the conference call by dialing 888-889-0278 (passcode: Entercom). A replay of the conference call will be available and can be accessed either by dialing 866-448-4805 or by visiting the Company’s website: www.entercom.com. Additional information and reconciliation of same station results are available on the Company’s website at www.entercom.com.

Certain Definitions

All references to per share data, unless stated otherwise, are presented as per diluted share. All references to shares outstanding, unless stated otherwise, are presented to exclude unvested restricted stock units. All references to net debt are outstanding debt net of cash on hand.

Station expenses consist of station operating expenses excluding non-cash compensation expense.

Corporate expenses consist of corporate general and administrative expenses excluding non-cash compensation expense.

Station Operating Income consists of operating income (loss) before: depreciation and amortization; time brokerage agreement fees (income); corporate general and administrative expenses; non-cash compensation expense (which is otherwise included in station operating expenses); impairment loss; merger and acquisition costs and restructuring charges; and gain or loss on sale or disposition of assets.

Adjusted EBITDA consists of net income (loss) available to common shareholders, adjusted to exclude: income taxes (benefit); total other expense; depreciation and amortization; time brokerage agreement fees (income); non-cash compensation expense (which is otherwise included in station operating expenses and corporate G&A expenses); impairment loss; merger and acquisition costs, preferred stock dividends and restructuring charges; and gain or loss on sale or disposition of assets.


Free Cash Flow consists of operating income (loss): (i) plus depreciation and amortization, net (gain) loss on sale or disposal of assets; non-cash compensation expense (which is otherwise included in station operating expenses and corporate general and administrative expenses), impairment loss; merger and acquisition costs and restructuring charges; and (ii) less net interest expense (excluding amortization of deferred financing costs), preferred stock dividends, taxes paid and capital expenditures.

Adjusted Net Income (Loss) consists of net income (loss) available to common shareholders adjusted to exclude: (i) income taxes (benefit) as reported; (ii) gain/loss on sale of assets, derivative instruments and investments; (iii) non-cash compensation expense; (iv) other income; (v) impairment loss; (vi) merger and acquisition costs and restructuring charges; and (vii) gain/loss on early extinguishment of debt. For purposes of comparability, income taxes are reflected at the expected statutory federal and state income tax rate of 40% without discrete items of tax.

Adjusted Net Income Per Share includes any dilutive equivalent shares when not anti-dilutive. Convertible Preferred Stock treated as if never converted for the purposes of Adjusted Net Income Per Share.

Same station is computed by comparing the performance of stations operated by the Company throughout the relevant period to the comparable performance in the prior year’s corresponding period (excluding non-cash compensation expense).

Non-GAAP Financial Measures

It is important to note that station operating income, station expense, corporate expense, same station net revenues, same station expenses, same station operating income, Adjusted EBITDA, Adjusted Net Income, Adjusted Net Income Per Share and Free Cash Flow are not measures of performance or liquidity calculated in accordance with generally accepted accounting principles (“GAAP”). Management believes that these measures are useful as a way to evaluate the Company and the means for management to evaluate our radio stations’ performance and operations. Management believes that these measures are useful to an investor in evaluating our performance because they are widely used in the broadcast industry as a measure of a radio company’s operating performance.

Certain adjusted non-GAAP financial measures are presented in this release (e.g., Adjusted Net Income and Adjusted Net Income Per Share). The adjustments exclude gain/loss on sale of assets, derivative instruments, and investments; non-cash compensation expense, other income, impairment loss and gain/loss on early extinguishment of debt. Management believes these adjusted non-GAAP measures provide useful information to Management and investors by excluding certain income, expenses and gains and losses that may not be indicative of the Company’s core operating and financial results. Similarly, Management believes these adjusted measures are a useful performance measure because certain items included in the calculation of net income (loss) may either mask or exaggerate trends in the Company’s ongoing operating performance. Further, the reconciliations corresponding to these adjusted measures, by identifying the individual adjustments, provide a useful


mechanism for investors to consider these adjusted measures with some or all of the identified adjustments.

Management uses these non-GAAP financial measures on an ongoing basis to help track and assess the Company’s financial performance. You, however, should not consider non-GAAP measures in isolation or as substitutes for net income (loss), operating income, or any other measure for determining our operating performance that is calculated in accordance with generally accepted accounting principles. These non-GAAP measures are not necessarily comparable to similarly titled measures employed by other companies. The accompanying financial tables provide reconciliations to the nearest GAAP measure of all non-GAAP measures provided in this release.

Note Regarding Forward-Looking Statements

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

This news announcement contains certain forward-looking statements that are based upon current expectations and certain unaudited pro forma information that is presented for illustrative purposes only and involves certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Additional information and key risks are described in the Company’s filings on Forms 8-K, 10-Q and 10-K with the Securities and Exchange Commission. Readers should note that these statements might be impacted by several factors including changes in the economic and regulatory climate and the business of radio broadcasting, in general. The unaudited pro forma information and same station operating data reflect adjustments and are presented for comparative purposes only and do not purport to be indicative of what has occurred or indicative of future operating results or financial position. Accordingly, the Company’s actual performance may differ materially from those stated or implied herein. The Company assumes no obligation to publicly update or revise any unaudited pro forma or forward-looking statements.

About Entercom

Entercom Communications Corp. (NYSE: ETM) is the fourth-largest radio broadcasting company in the U.S., reaching and engaging more than 40 million people a week through its 124 highly rated stations in 27 top markets across the country. Entercom is a purpose-driven company, deeply committed to entertaining and informing its listeners with the best locally curated music, news, sports, and talk content, driven by compelling local personalities. Entercom delivers superior ROI by connecting its customers and audiences through its leading local brands and unparalleled local marketing solutions, which include over 4,000 events each year, and its SmartReach Digital product suite. Learn more about Philadelphia-based Entercom at www.Entercom.com, Facebook and Twitter (@entercom).


Second Quarter 2016

Earnings Release

ENTERCOM COMMUNICATIONS CORP.

FINANCIAL DATA

(amounts in thousands, except per share data)

(unaudited)

 

     Three Months Ended
June 30,
    Six Months Ended
June 30,
 
     2016     2015     2016     2015  

STATEMENTS OF OPERATIONS

        

Net Revenues

   $ 120,478      $ 100,592      $ 216,581      $ 179,012   
  

 

 

   

 

 

   

 

 

   

 

 

 

Station Expenses

     82,276        69,632        153,764        128,822   

Station Expense - Non-Cash Compensation

     363        368        590        545   

Corporate Expenses

     7,319        5,389        13,662        10,733   

Corporate Expenses - Non-Cash Compensation

     1,174        1,062        2,429        1,997   

Depreciation And Amortization

     2,517        1,905        4,964        3,860   

Merger And Acquisition Costs And Restructuring Charges

     —          2,031        —          3,754   

Impairment loss

     —          —          62        —     

Net Gain On Sale Or Disposition of Assets

     (755     (410     (1,219     (567
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Operating Expenses

     92,894        79,977        174,252        149,144   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

     27,584        20,615        42,329        29,868   
  

 

 

   

 

 

   

 

 

   

 

 

 

Other Expense Item:

        

Net Interest Expense

     9,147        9,313        18,539        18,592   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Other Expense

     9,147        9,313        18,539        18,592   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income Before Income Taxes

     18,437        11,302        23,790        11,276   

Income Taxes

     7,603        4,555        8,544        4,622   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income Available To The Company

     10,834        6,747        15,246        6,654   

Preferred Stock Dividend

     412        —          825        —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income Available To Common Shareholders

   $ 10,422      $ 6,747      $ 14,421      $ 6,654   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income Available To Common Shareholders Per Share - Basic

   $ 0.27      $ 0.18      $ 0.37      $ 0.17   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income Available To Common Shareholders Per Share - Diluted

   $ 0.26      $ 0.17      $ 0.37      $ 0.17   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted Common Shares Outstanding - Basic

     38,469        38,074        38,463        38,071   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted Common Shares Outstanding - Diluted

     41,130        38,929        39,274        39,027   
  

 

 

   

 

 

   

 

 

   

 

 

 

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

        

Capital Expenditures

   $ 1,073      $ 2,750      $ 2,038      $ 4,744   

Income Taxes Paid

   $ 68      $ 65      $ 208      $ 81   

Cash Interest

   $ 15,227      $ 14,595      $ 18,307      $ 17,456   

Cash Dividends On Preferred Stock

   $ 412      $ —        $ 825      $ —     

SELECTED BALANCE SHEET DATA

   June 30,              
     2016     2015              

Cash and Cash Equivalents

   $ 11,071      $ 43,663       

Senior Debt - Term B Loan And Other (Includes Current Debt)

   $ 230,093      $ 260,500       

Senior Debt - Revolver (Includes Current Debt)

   $ 17,000      $ —         

Senior Notes

   $ 218,453      $ 218,094       

Perpetual Cumulative Convertible Preferred Stock

   $ 27,619      $ —         

Total Shareholders’ Equity

   $ 373,678      $ 336,728       


OTHER FINANCIAL DATA

 

     Three Months Ended
June 30,
    Six Months Ended
June 30,
 
     2016     2015     2016     2015  

Reconciliation Of GAAP Station Operating Expenses To Station Expenses

        

Station Operating Expenses

   $ 82,639      $ 70,000      $ 154,354      $ 129,367   

Station Expenses - Non-Cash Compensation

     (363     (368     (590     (545
  

 

 

   

 

 

   

 

 

   

 

 

 

Station Expenses

   $ 82,276      $ 69,632      $ 153,764      $ 128,822   
  

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation Of GAAP Corporate General & Administrative Expenses

        

To Corporate Expenses

        

Corporate General & Administrative Expenses

   $ 8,493      $ 6,451      $ 16,091      $ 12,730   

Corporate Expenses - Non-Cash Compensation

     (1,174     (1,062     (2,429     (1,997
  

 

 

   

 

 

   

 

 

   

 

 

 

Corporate Expenses

   $ 7,319      $ 5,389      $ 13,662      $ 10,733   
  

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation Of GAAP Operating Income To Station Operating Income

        

Operating Income

   $ 27,584      $ 20,615      $ 42,329      $ 29,868   

Corporate Expenses

     7,319        5,389        13,662        10,733   

Corporate Expenses - Non-Cash Compensation

     1,174        1,062        2,429        1,997   

Station Expenses - Non-Cash Compensation

     363        368        590        545   

Depreciation And Amortization

     2,517        1,905        4,964        3,860   

Impairment Loss

     —          —          62        —     

Merger And Acquisition Costs And Restructuring Charges

     —          2,031        —          3,754   

Net Gain On Sale Or Disposition of Assets

     (755     (410     (1,219     (567
  

 

 

   

 

 

   

 

 

   

 

 

 

Station Operating Income

   $ 38,202      $ 30,960      $ 62,817      $ 50,190   
  

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation Of GAAP Net Income Available To Common

        

Shareholders To Adjusted EBITDA

        

Net Income Available To Common Shareholders

   $ 10,422      $ 6,747      $ 14,421      $ 6,654   

Income Taxes

     7,603        4,555        8,544        4,622   

Total Other Expense

     9,147        9,313        18,539        18,592   

Corporate Expenses - Non-Cash Compensation

     1,174        1,062        2,429        1,997   

Station Expenses - Non-Cash Compensation

     363        368        590        545   

Depreciation And Amortization

     2,517        1,905        4,964        3,860   

Impairment Loss

     —          —          62        —     

Preferred Stock Dividend

     412        —          825        —     

Merger And Acquisition Costs And Restructuring Charges

     —          2,031        —          3,754   

Net Gain On Sale Or Disposition of Assets

     (755     (410     (1,219     (567
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

   $ 30,883      $ 25,571      $ 49,155      $ 39,457   
  

 

 

   

 

 

   

 

 

   

 

 

 


     Three Months Ended
June 30,
    Six Months Ended
June 30,
 
     2016     2015     2016     2015  

Reconciliation Of GAAP Net Income Available To Common

        

Shareholders To Free Cash Flow

        

Net Income Available To Common Shareholders

   $ 10,422      $ 6,747      $ 14,421      $ 6,654   

Depreciation And Amortization

     2,517        1,905        4,964        3,860   

Deferred Financing Costs Included In Interest Expense

     632        716        1,319        1,423   

Amortization Of Original Issue Discount Included In Interest Expense

     93        84        184        165   

Non-Cash Compensation Expense

     1,537        1,430        3,019        2,542   

Merger And Acquisition Costs And Restructuring Charges

     —          2,031        —          3,754   

Impairment Loss

     —          —          62        —     

Net Gain On Sale Or Disposition of Assets

     (755     (410     (1,219     (567

Income Taxes

     7,603        4,555        8,544        4,622   

Capital Expenditures

     (1,073     (2,750     (2,038     (4,744

Income Taxes Paid

     (68     (65     (208     (81
  

 

 

   

 

 

   

 

 

   

 

 

 

Free Cash Flow

   $ 20,908      $ 14,243      $ 29,048      $ 17,628   
  

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation Of GAAP Operating Income To Free Cash Flow:

        

Operating Income

   $ 27,584      $ 20,615      $ 42,329      $ 29,868   

Depreciation and Amortization

     2,517        1,905        4,964        3,860   

Non-Cash Compensation Expense

     1,537        1,430        3,019        2,542   

Interest Expense, Net of Interest Income, Deferred Financing Costs & OID

     (8,422     (8,513     (17,036     (17,004

Impairment Loss

     —          —          62        —     

Preferred Stock Dividend

     (412     —          (825     —     

Capital Expenditures

     (1,073     (2,750     (2,038     (4,744

Merger And Acquisition Costs And Restructuring Charges

     —          2,031        —          3,754   

Net Gain On Sale Or Disposition of Assets

     (755     (410     (1,219     (567

Income Taxes Paid

     (68     (65     (208     (81
  

 

 

   

 

 

   

 

 

   

 

 

 

Free Cash Flow

   $ 20,908      $ 14,243      $ 29,048      $ 17,628   
  

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation Of GAAP Net Income Available To Common

        

Shareholders To Adjusted Net Income

        

Net Income Available To Common Shareholders

   $ 10,422      $ 6,747      $ 14,421      $ 6,654   

Preferred Stock Dividend

     412        —          825        —     

Income Taxes

     7,603        4,555        8,544        4,622   

Merger And Acquisition Costs And Restructuring Charges

     —          2,031        —          3,754   

Impairment Loss

     —          —          62        —     

Net Gain On Sale Or Disposition of Assets

     (755     (410     (1,219     (567

Non-Cash Compensation Expense

     1,537        1,430        3,019        2,542   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Income Before Income Taxes

     19,219        14,353        25,652        17,005   

Income Taxes

     7,688        5,741        10,261        6,802   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Net Income Available To The Company

     11,531        8,612        15,391        10,203   

Preferred Stock Dividend

     412        —          825        —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Net Income

   $ 11,119      $ 8,612      $ 14,566      $ 10,203   
  

 

 

   

 

 

   

 

 

   

 

 

 

Numerator For Purposes Of Computing Adjusted Net Income Per Share—Diluted

        

Adjusted Net Income

   $ 11,119      $ 8,612      $ 14,566      $ 10,203   

Preferred Stock Dividend, Treated As If Preferred Is Never Converted

     —          —          —          —     
  

 

 

   

 

 

   

 

 

   

 

 

 
   $ 11,119      $ 8,612      $ 14,566      $ 10,203   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted Average Diluted Shares Outstanding For Purposes

        

Of Computing Adjusted Net Income Per Share - Diluted

        

Weighted Common Shares Outstanding - Diluted As Reported

     41,130        38,929        39,274        39,027   

Preferred Stock Dividend, Treated As If Preferred Is Never Converted

     (1,923     —          —          —     
  

 

 

   

 

 

   

 

 

   

 

 

 
     39,207        38,929        39,274        39,027   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Net Income Per Share - Diluted

   $ 0.28      $ 0.22      $ 0.37      $ 0.26