GREENWICH, Conn.,
March 13, 2018 /PRNewswire/ -- Townsquare Media, Inc. (NYSE:
TSQ) ("Townsquare," the "Company," "we," "us," or "our") announced
today financial results for the fourth quarter and year ended
December 31, 2017.
"We are pleased to announce another strong result in our Local
Marketing Solutions segment, which delivered net revenue growth of
0.4% in the fourth quarter of 2017, and 1.9% for the full year,
despite the loss of political revenue. This was the
16th consecutive quarter of positive, organic net
revenue growth for this segment of our Company. Excluding
political revenue, Local Marketing Solutions net revenue increased
5.2% in the fourth quarter of 2017, our strongest quarter of the
year, and 3.9% for the full year," commented Bill Wilson, Co-Chief Executive Officer of
Townsquare.
The Company also announced today that its Board of Directors
approved the initiation of a quarterly cash dividend of
$0.075 per share. The dividend
will be payable on May 15, 2018 to
shareholders of record as of the close of business on April 2, 2018.
"The Board's decision to approve a dividend reflects confidence
in our current capitalization, the strength of our balance sheet,
our free cash flow generation, and our outlook for 2018," commented
Dhruv Prasad, Co-Chief Executive
Officer of Townsquare. "Our quarterly cash dividend of
$0.075 per share, or $0.30 per share on an annual basis, commences in
May 2018."
Fourth Quarter Highlights*
- As compared to the fourth quarter of 2016 on an actual
basis:
-
- Local Marketing Solutions net revenue increased 0.4%, and 5.2%
excluding political revenue
- Entertainment net revenue decreased 17.4%
- Net revenue decreased 3.7%, and 0.2% excluding political
revenue
- Net income from continuing operations decreased 941.5%
- Adjusted EBITDA decreased 12.7%, to $21.6 million, consistent with previously issued
guidance
- Diluted net loss per share from continuing operations and
diluted Adjusted Net Income Per Share were $(1.42) and $0.14,
respectively
Full Year Highlights*
- As compared to the year ended December
31, 2016 on an actual basis:
-
- Local Marketing Solutions net revenue increased 1.9%, and 3.9%
excluding political revenue
- Entertainment net revenue decreased 8.6%
- Net revenue decreased 1.7%, and 0.4% excluding political
revenue
- Net income from continuing operations decreased 138.3%
- Adjusted EBITDA decreased 8.8%, to $97.2
million, consistent with previously issued guidance
- Diluted net loss per share from continuing operations and
diluted Adjusted Net Income Per Share were $(0.48) and $0.74,
respectively
- Repaid $6.7 million of long-term
debt
* See below for discussion of non-GAAP measures and
reconciliations to GAAP measures.
Segment Reporting
We have two reportable segments,
Local Marketing Solutions, which provides broadcast and digital
products and solutions to advertisers and businesses within our
local markets, and Entertainment, which provides live event
experiences and music and lifestyle content directly to consumers,
and promotion, advertising and product activations to local and
national advertisers.
Quarter Ended December 31,
2017 Compared to the Quarter Ended December 31, 2016
Net Revenue
Net revenue for the quarter ended
December 31, 2017 decreased
$4.4 million, or 3.7%, to
$114.3 million, as compared to
$118.7 million in the same period
last year. Local Marketing Solutions net revenue increased
$0.4 million, or 0.4%, to
$91.6 million and Entertainment net
revenue decreased $4.8 million,
or 17.4%, to $22.6 million, due to
revenue declines in certain of our live events and in our national
digital business. Excluding political revenue, net revenue
decreased $0.3 million, or 0.2%, to
$113.1 million and Local Marketing
Solutions net revenue increased $4.5
million, or 5.2%, to $90.5
million.
Net (Loss) Income
Net (loss) income for the quarter
ended December 31, 2017 decreased
$30.3 million, or 944.1%, to a net
loss of $27.1 million, as compared to
net income of $3.2 million in the
same period last year. Net (loss) income from continuing
operations for the quarter ended December
31, 2017 decreased $29.4
million, or 941.5%, to a net loss of $26.3 million, as compared to net income of
$3.1 million in the same period last
year. Net (loss) income and net (loss) income from continuing
operations declined primarily due to a $51.8
million impairment charge recorded in the quarter ended
December 31, 2017.
Adjusted EBITDA
Adjusted EBITDA for the quarter ended
December 31, 2017 decreased
$3.1 million, or 12.7%, to
$21.6 million, as compared to
$24.8 million in the same period last
year.
Year Ended December 31, 2017
Compared to the Year Ended December 31,
2016
Net Revenue
Net revenue for the year ended
December 31, 2017 decreased
$8.6 million, or 1.7%, to
$507.4 million, as compared to
$516.0 million in the same period
last year. Local Marketing Solutions net revenue increased
$6.5 million or 1.9%, to $348.7 million and Entertainment net revenue
decreased $15.0 million or 8.6%, to
$158.8 million, due to revenue
declines in certain of our live events and in our national digital
business. Excluding political revenue, net revenue decreased
$2.0 million, or 0.4%, to
$505.0 million and Local Marketing
Solutions net revenue increased $13.1
million, or 3.9%, to $346.2
million.
Net (Loss) Income
Net (loss) income for the year ended
December 31, 2017 decreased
$33.6 million, or 144.1%, to a net
loss of $10.3 million, as compared to
net income of $23.3 million in the
same period last year. Net (loss) income from continuing operations
for the year ended December 31, 2017
decreased $32.1 million, or 138.3%,
to a net loss of $8.9 million, as
compared to net income of $23.2
million in the same period last year. Net (loss) income and
net (loss) income from continuing operations declined primarily due
to a $51.8 million impairment charge
recorded in the quarter ended December 31,
2017.
Adjusted EBITDA
Adjusted EBITDA for the year ended
December 31, 2017 decreased
$9.4 million, or 8.8%, to
$97.2 million, as compared to
$106.6 million in the same period
last year.
Liquidity and Capital Resources
As of December 31, 2017, we had a total of $65.3 million of cash on hand and $50.0 million of available borrowing capacity
under our revolving credit facility. As of December 31, 2017, we had $571.9 million of outstanding indebtedness,
representing 5.9x and 5.2x gross and net leverage, respectively,
based on Adjusted EBITDA for the year ended December 31, 2017 of $97.2
million.
The table below presents a summary, as of March 10, 2018, of our outstanding common stock
and securities convertible into common stock, excluding options
issued under our 2014 Omnibus Incentive Plan.
Security
|
|
Number
Outstanding1
|
Description
|
Class A common
stock
|
|
13,837,676
|
One vote per
share.
|
Class B common
stock
|
|
3,022,484
|
10 votes per
share.2
|
Class C common
stock
|
|
1,636,341
|
No
votes.2
|
Warrants
|
|
8,977,676
|
Each warrant is
exercisable for one share of Class A common stock, at
an exercise price of $0.0001 per share. The aggregate exercise
price for
all warrants currently outstanding is $898.3
|
Total
|
|
27,474,177
|
|
|
|
|
|
1
Each of the shares of common stock listed below, including the
shares of Class A common stock issuable upon
exercise of the warrants, has equal economic rights.
|
2
Each share converts into 1 share of Class A common stock upon
transfer or at the option of the holder, subject to
certain conditions, including compliance with FCC rules.
|
3 The
warrants are fully vested and exercisable for shares of Class A
common stock, subject to certain conditions,
including compliance with FCC rules.
|
Conference Call
Townsquare Media, Inc. will host a
conference call to discuss certain fourth quarter and full year
2017 financial results on Tuesday, March 13,
2018 at 8:00 a.m. Eastern
Time. The conference call dial-in number is 1-877-407-0784
(U.S. & Canada) or
1-201-689-8560 (International) and the confirmation code is
13675865. A live webcast of the conference call will also be
available on the equity investor relations page of the Company's
website at www.townsquaremedia.com.
A replay of the conference call will be available through
March 20, 2018. To access the replay,
please dial 1-844-512-2921 (U.S. & Canada) or 1-412-317-6671 (International) and
enter confirmation code 13675865. A web-based archive of the
conference call will also be available at the above website for
thirty days after the call.
About Townsquare Media, Inc.
Townsquare is a radio,
digital media, entertainment and digital marketing solutions
company principally focused on being the premier local advertising
and marketing solutions platform in small and mid-sized markets
across the U.S. Our assets include 317 radio stations and more than
325 local websites in 67 U.S. markets, a digital marketing
solutions company (Townsquare Interactive) serving approximately
12,400 small to medium sized businesses, a proprietary digital
programmatic advertising platform (Townsquare Ignite) and
approximately 350 live events with nearly 18 million attendees each
year in the U.S. and Canada. Our
brands include local media assets such as WYRK, KLAQ,
K2 and NJ101.5; music festivals such as Mountain
Jam, WE Fest and the Taste of Country Music
Festival; touring lifestyle and entertainment events such as
the America on Tap craft beer festival series and North
American Midway Entertainment, North
America's largest mobile amusement company; and leading
tastemaker music and entertainment owned and affiliated websites
such as XXLmag.com, TasteofCountry.com and
Loudwire.com. For more information, please visit
www.townsquaremedia.com, www.townsquareinteractive.com, and
www.townsquareignite.com.
Forward-Looking Statements
Except for the historical
information contained in this press release, the matters addressed
are forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements often discuss our current expectations and projections
relating to our financial condition, results of operations, plans,
objectives, future performance and business. You can identify
forward-looking statements by the fact that they do not relate
strictly to historical or current facts. These statements may
include words such as "aim," "anticipate," "estimate," "expect,"
"forecast," "outlook," "potential," "project," "projection,"
"plan," "intend," "seek," "believe," "may," "could," "would,"
"will," "should," "can," "can have," "likely," the negatives
thereof and other words and terms. By nature, forward-looking
statements involve risks and uncertainties that could cause actual
results to differ materially from those projected or implied by the
forward-looking statement. Forward-looking statements are based on
current expectations and assumptions and currently available data
and are neither predictions nor guarantees of future events or
performance. You should not place undue reliance on forward-looking
statements, which speak only as of the date hereof. See "Risk
Factors" and "Forward-Looking Statements" included in our Annual
Report on Form 10-K for the year ended December 31, 2017, filed with the Securities and
Exchange Commission on or about the date hereof, for a discussion
of factors that could cause our actual results to differ from those
expressed or implied by forward-looking statements. Townsquare
Media, Inc. assumes no responsibility to update any forward-looking
statement as a result of new information, future events or
otherwise, except as required by law.
Non-GAAP Financial Measures and Definitions
In this
press release, we refer to Adjusted EBITDA, Adjusted EBITDA Less
Interest, Capex and Taxes, Adjusted Net Income, Adjusted Net
Income Per Share and Adjusted Segment Operating Income which are
financial measures that have not been prepared in accordance with
generally accepted accounting principles in the United States ("GAAP").
We define Adjusted EBITDA as net (loss) income before the
deduction of income taxes, other expense (income) net, interest
expense, net, repurchase of debt, transaction costs, stock-based
compensation, net loss (gain) on sale and retirement of assets,
business realignment costs, goodwill and other intangible
impairment charges, net (loss) income on discontinued operations,
net of income taxes, impairment of investment and depreciation and
amortization. Adjusted EBITDA Less Interest, Capex and Taxes is
defined as Adjusted EBITDA less net cash interest expense, capital
expenditures and cash paid for taxes. Adjusted Net Income is
defined as net (loss) income before the deduction of income taxes,
transaction costs, business realignment costs, impairment of
investment, goodwill and other intangible impairment charges,
one-time stock option repricing, net loss (gain) on sale and
retirement of assets, repurchase of debt and net (loss) income from
discontinued operations, net of income taxes. Adjusted Net
Income Per Share is defined as Adjusted Net Income divided by the
weighted average shares outstanding. Adjusted Segment Operating
Income is defined as segment operating income before the deduction
of depreciation and amortization, stock-based compensation,
business realignment costs and goodwill and other intangible
impairment charges. These measures do not represent, and should not
be considered as alternatives to, net income (loss), segment
operating income or cash flows from operations, as determined under
GAAP. In addition, these non-GAAP measures may not be
comparable to similarly-named measures reported by other
companies. Reconciliations of these non-GAAP measures to the
most directly comparable financial measures calculated and
presented in accordance with GAAP are set forth in the tables
below.
We use Adjusted EBITDA to facilitate company-to-company
operating performance comparisons by backing out potential
differences caused by variations in capital structures (affecting
interest expense), taxation and the age and book depreciation of
facilities and equipment (affecting relative depreciation expense),
which may vary for different companies for reasons unrelated to
operating performance. We use Adjusted Net Income and Adjusted Net
Income Per Share to assess total company operating performance on a
consistent basis. We use Adjusted Segment Operating Income to
evaluate the operating performance of our business segments. We
believe that these measures, when considered together with our GAAP
financial results, provide management and investors with a more
complete understanding of our business operating results, including
underlying trends, by excluding the effects of transaction costs,
net loss (gain) on sale and retirement of assets, repurchase of
debt, business realignment costs, certain impairments, a one-time
stock option repricing and net (loss) income from discontinued
operations. Further, while discretionary bonuses for members
of management are not determined with reference to specific
targets, our Board of Directors may consider Adjusted EBITDA,
Adjusted EBITDA Less Interest, Capex and Taxes, Adjusted Net
Income, Adjusted Net Income Per Share and Adjusted Segment
Operating Income when determining discretionary bonuses.
Investor Relations
Claire Yenicay
(203) 900-5555
investors@townsquaremedia.com
TOWNSQUARE MEDIA,
INC.
|
CONSOLIDATED
BALANCE SHEETS
|
(in Thousands,
Except Share and Per Share Data)
|
|
|
December
31,
2017
|
|
December
31,
2016
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash
|
$
|
65,295
|
|
|
$
|
51,540
|
|
Accounts receivable,
net of allowance of $1,079 and $1,433, respectively
|
61,659
|
|
|
59,580
|
|
Prepaid expenses and
other current assets
|
10,471
|
|
|
11,253
|
|
Current assets
held for sale
|
879
|
|
|
â
|
|
Current assets of discontinued operations
|
100
|
|
|
254
|
|
Total current
assets
|
138,404
|
|
|
122,627
|
|
|
|
|
|
Property and
equipment, net
|
146,992
|
|
|
139,408
|
|
Intangible assets,
net
|
508,399
|
|
|
513,915
|
|
Goodwill
|
243,042
|
|
|
292,953
|
|
Investments
|
8,092
|
|
|
4,313
|
|
Other
assets
|
10,998
|
|
|
7,290
|
|
Long-term assets of
discontinued operations
|
431
|
|
|
â
|
|
Long-term assets held
for sale
|
â
|
|
|
199
|
|
Total
assets
|
$
|
1,056,358
|
|
|
$
|
1,080,705
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
|
14,559
|
|
|
$
|
10,602
|
|
Current portion of
long-term debt
|
9,524
|
|
|
6,901
|
|
Deferred
revenue
|
17,683
|
|
|
17,208
|
|
Accrued expenses and
other current liabilities
|
25,160
|
|
|
25,748
|
|
Accrued
interest
|
5,699
|
|
|
4,622
|
|
Current liabilities of discontinued operations
|
680
|
|
|
71
|
|
Total current
liabilities
|
73,305
|
|
|
65,152
|
|
Long-term debt, less
current portion (net of deferred financing costs of $6,803 and
$8,006, respectively)
|
555,618
|
|
|
564,315
|
|
Deferred tax
liability
|
36,965
|
|
|
50,907
|
|
Other long-term
liabilities
|
9,390
|
|
|
10,221
|
|
Long-term liabilities
of discontinued operations
|
â
|
|
|
59
|
|
Total
liabilities
|
675,278
|
|
|
690,654
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
Class A common stock,
par value $0.01 per share; 300,000,000 shares authorized;
13,819,639 and 13,735,690 shares
issued and outstanding,
respectively
|
138
|
|
|
137
|
|
Class B common stock,
par value $0.01 per share; 50,000,000 shares authorized; 3,022,484
shares issued and
outstanding
|
30
|
|
|
30
|
|
Class C common stock,
par value $0.01 per share; 50,000,000 shares authorized; 1,636,341
shares issued and
outstanding
|
17
|
|
|
17
|
|
Total common stock
|
185
|
|
|
184
|
|
Additional paid-in capital
|
367,041
|
|
|
365,434
|
|
Retained earnings
|
13,265
|
|
|
24,450
|
|
Accumulated other comprehensive loss
|
(532)
|
|
|
(722)
|
|
Noncontrolling interest
|
1,121
|
|
|
705
|
|
Total stockholders'
equity
|
381,080
|
|
|
390,051
|
|
Total liabilities
and stockholders' equity
|
$
|
1,056,358
|
|
|
$
|
1,080,705
|
|
TOWNSQUARE MEDIA,
INC.
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(in Thousands,
Except Per Share Data)
|
|
|
Three Months
Ended
December 31,
|
|
Years Ended
December 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
|
Net
revenue
|
$
|
114,255
|
|
|
$
|
118,650
|
|
|
$
|
507,434
|
|
|
$
|
515,995
|
|
|
|
|
|
|
|
|
|
Operating costs and
expenses:
|
|
|
|
|
|
|
|
Direct operating
expenses, excluding depreciation, amortization and stock-based
compensation
|
85,183
|
|
|
86,850
|
|
|
384,412
|
|
|
383,994
|
|
Depreciation and
amortization
|
5,935
|
|
|
6,159
|
|
|
25,683
|
|
|
23,971
|
|
Corporate
expenses
|
7,453
|
|
|
7,050
|
|
|
25,828
|
|
|
25,370
|
|
Stock-based
compensation
|
177
|
|
|
3,590
|
|
|
748
|
|
|
4,253
|
|
Transaction
costs
|
569
|
|
|
238
|
|
|
1,175
|
|
|
844
|
|
Business realignment
costs
|
6,204
|
|
|
â
|
|
|
6,204
|
|
|
â
|
|
Goodwill and other
intangible impairment charges
|
51,848
|
|
|
â
|
|
|
51,848
|
|
|
â
|
|
Net (gain) loss on
sale and retirement of assets
|
(265)
|
|
|
(5)
|
|
|
397
|
|
|
282
|
|
Total operating costs and expenses
|
157,104
|
|
|
103,882
|
|
|
496,295
|
|
|
438,714
|
|
Operating (loss) income
|
(42,849)
|
|
|
14,768
|
|
|
11,139
|
|
|
77,281
|
|
|
|
|
|
|
|
|
|
Other expense
(income):
|
|
|
|
|
|
|
|
Interest expense,
net
|
8,279
|
|
|
8,332
|
|
|
32,753
|
|
|
34,072
|
|
Impairment on
investment
|
â
|
|
|
â
|
|
|
â
|
|
|
4,236
|
|
Repurchase of
debt
|
â
|
|
|
(85)
|
|
|
â
|
|
|
(546)
|
|
Other expense
(income), net
|
99
|
|
|
(312)
|
|
|
288
|
|
|
(665)
|
|
(Loss) income from
continuing operations before income taxes
|
(51,227)
|
|
|
6,833
|
|
|
(21,902)
|
|
|
40,184
|
|
(Benefit) provision for
income taxes
|
(24,956)
|
|
|
3,713
|
|
|
(13,027)
|
|
|
16,982
|
|
Net (loss) income
from continuing operations
|
(26,271)
|
|
|
3,120
|
|
|
(8,875)
|
|
|
23,202
|
|
Net (loss) income from
discontinued operations, net of income taxes
|
(850)
|
|
|
91
|
|
|
(1,398)
|
|
|
91
|
|
Net (loss)
income
|
$
|
(27,121)
|
|
|
$
|
3,211
|
|
|
$
|
(10,273)
|
|
|
$
|
23,293
|
|
|
|
|
|
|
|
|
|
Net (loss) income
attributable to:
|
|
|
|
|
|
|
|
Controlling
interests
|
$
|
(27,494)
|
|
|
$
|
3,234
|
|
|
$
|
(11,185)
|
|
|
$
|
23,059
|
|
Non-controlling
interests
|
373
|
|
|
(23)
|
|
|
912
|
|
|
234
|
|
|
|
|
|
|
|
|
|
Basic (loss)
income per share:
|
|
|
|
|
|
|
|
Continuing
operations
|
$
|
(1.42)
|
|
|
$
|
0.17
|
|
|
$
|
(0.48)
|
|
|
$
|
1.28
|
|
Discontinued
operations
|
(0.05)
|
|
|
â
|
|
|
(0.08)
|
|
|
â
|
|
|
$
|
(1.47)
|
|
|
$
|
0.17
|
|
|
$
|
(0.56)
|
|
|
$
|
1.28
|
|
|
|
|
|
|
|
|
|
Diluted (loss)
income per share:
|
|
|
|
|
|
|
|
Continuing
operations
|
$
|
(1.42)
|
|
|
$
|
0.12
|
|
|
$
|
(0.48)
|
|
|
$
|
0.85
|
|
Discontinued
operations
|
(0.05)
|
|
|
â
|
|
|
(0.08)
|
|
|
â
|
|
|
$
|
(1.47)
|
|
|
$
|
0.12
|
|
|
$
|
(0.56)
|
|
|
$
|
0.85
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
18,478
|
|
|
18,395
|
|
|
18,459
|
|
|
18,255
|
|
Diluted
|
18,478
|
|
|
27,419
|
|
|
18,459
|
|
|
27,313
|
|
TOWNSQUARE MEDIA,
INC.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(in
Thousands)
|
|
|
Year Ended
December 31,
|
|
2017
|
|
2016
|
Cash flows from
operating activities:
|
|
|
|
Net (loss) income
attributable to:
|
|
|
|
Controlling
interests
|
$
|
(11,185)
|
|
|
$
|
23,059
|
|
Noncontrolling
interests
|
912
|
|
|
234
|
|
Net (loss)
income
|
$
|
(10,273)
|
|
|
$
|
23,293
|
|
Adjustments to
reconcile net (loss) income to net cash from operating
activities:
|
|
|
|
Depreciation and
amortization
|
25,683
|
|
|
23,971
|
|
Amortization of
deferred financing costs
|
1,646
|
|
|
1,579
|
|
Deferred income tax
(benefit) expense
|
(13,806)
|
|
|
15,831
|
|
Provision for doubtful
accounts
|
2,186
|
|
|
1,921
|
|
Stock-based
compensation expense
|
748
|
|
|
4,253
|
|
Trade activity,
net
|
(11,754)
|
|
|
(9,731)
|
|
Repurchase of
debt
|
â
|
|
|
(546)
|
|
Write-off deferred
financing costs
|
83
|
|
|
376
|
|
Impairment of goodwill
|
48,933
|
|
|
â
|
Impairment of FCC
licenses
|
2,915
|
|
|
â
|
|
Write-off of
goodwill
|
4,105
|
|
|
â
|
|
Write-off of
trademark
|
771
|
|
|
â
|
|
Impairment on
investment
|
â
|
|
|
4,236
|
|
Net loss on sale and
retirement of assets
|
397
|
|
|
282
|
|
Changes in assets and
liabilities, net of acquisitions:
|
|
|
|
Accounts
receivable
|
(864)
|
|
|
3,987
|
|
Prepaid expenses and
other assets
|
(676)
|
|
|
(704)
|
|
Accounts
payable
|
669
|
|
|
(2,463)
|
|
Accrued
expenses
|
(625)
|
|
|
(5,002)
|
|
Accrued
interest
|
1,107
|
|
|
(288)
|
|
Other long-term
liabilities
|
(835)
|
|
|
(1,074)
|
|
Net cash provided by
operating activities - continuing operations
|
50,410
|
|
|
59,921
|
|
Net cash provided by
(used in) operating activities - discontinued operations
|
274
|
|
|
(124)
|
|
Net cash provided
by operating activities
|
50,684
|
|
|
59,797
|
|
Cash flows from
investing activities:
|
|
|
|
Payments
for acquisitions, net of cash received
|
(5,511)
|
|
|
(2,160)
|
|
Payment
for investment
|
(857)
|
|
|
â
|
|
Acquisition of intangibles
|
(150)
|
|
|
(11)
|
|
Purchase
of property and equipment
|
(22,824)
|
|
|
(20,722)
|
|
Proceeds
from insurance settlement
|
â
|
|
|
451
|
|
Proceeds
from sale of assets
|
1,092
|
|
|
1,678
|
|
Net cash used in
investing activities - continuing operations
|
(28,250)
|
|
|
(20,764)
|
|
Net cash used in
investing activities - discontinued operations
|
(680)
|
|
|
(199)
|
|
Net cash used in
investing activities
|
(28,930)
|
|
|
(20,963)
|
|
Cash flows from
financing activities:
|
|
|
|
Proceeds from
exercise of employee stock options
|
346
|
|
|
â
|
|
Repayment
of long-term debt
|
(6,662)
|
|
|
(19,375)
|
|
Debt
financing costs
|
(526)
|
|
|
â
|
|
Proceeds
from sale of noncontrolling interest in subsidiary
|
â
|
|
|
50
|
|
Cash distributions to
noncontrolling interests
|
(496)
|
|
|
(219)
|
|
Repayments of capitalized obligations
|
(616)
|
|
|
(171)
|
|
Net cash used in
financing activities
|
(7,954)
|
|
|
(19,715)
|
|
Net effect of
foreign currency exchange rate changes
|
(45)
|
|
|
(877)
|
|
Net increase in
cash and restricted cash
|
13,755
|
|
|
18,242
|
|
Cash and restricted
cash:
|
|
|
|
Beginning of
period
|
51,540
|
|
|
33,298
|
|
End of
period
|
$
|
65,295
|
|
|
$
|
51,540
|
|
TOWNSQUARE MEDIA,
INC.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS (continued)
|
(in
Thousands)
|
|
|
Year Ended
December 31,
|
|
2017
|
|
2016
|
Supplemental
Disclosure of Cash Flow Information:
|
|
|
|
Cash
payments:
|
|
|
|
Interest
|
$
|
29,917
|
|
|
$
|
32,371
|
|
Income
taxes
|
3,170
|
|
|
1,878
|
|
Purchase
obligations:
|
|
|
|
Capital
lease
|
$
|
â
|
|
|
$
|
525
|
|
Equity issued in
respect of acquisitions:
|
|
|
|
Common stock, joint
venture acquisition
|
$
|
513
|
|
|
$
|
â
|
|
Non-cash
investment:
|
|
|
|
Investments
|
$
|
2,972
|
|
|
$
|
3,500
|
|
TOWNSQUARE MEDIA,
INC.
|
CONSOLIDATED
STATEMENTS OF OPERATIONS BY SEGMENT
|
(in
Thousands)
|
|
|
Three Months
Ended
December 31,
|
|
Years Ended
December 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Statement of
Operations Data:
|
|
|
|
|
|
|
|
Local
Marketing Solutions net revenue
|
$
|
91,648
|
|
|
$
|
91,277
|
|
|
$
|
348,660
|
|
|
$
|
342,191
|
|
Entertainment
net revenue
|
22,607
|
|
|
27,373
|
|
|
158,774
|
|
|
173,804
|
|
Net
revenue
|
114,255
|
|
|
118,650
|
|
|
507,434
|
|
|
515,995
|
|
Operating Costs and
Expenses:
|
|
|
|
|
|
|
|
Local
Marketing Solutions direct operating expenses
|
61,783
|
|
|
58,460
|
|
|
234,524
|
|
|
223,286
|
|
Entertainment
direct operating expenses
|
23,400
|
|
|
28,390
|
|
|
149,888
|
|
|
160,708
|
|
Direct operating
expenses, excluding depreciation, amortization
and stock-based compensation
|
85,183
|
|
|
86,850
|
|
|
384,412
|
|
|
383,994
|
|
Depreciation and
amortization
|
5,935
|
|
|
6,159
|
|
|
25,683
|
|
|
23,971
|
|
Corporate
expenses
|
7,453
|
|
|
7,050
|
|
|
25,828
|
|
|
25,370
|
|
Stock-based
compensation
|
177
|
|
|
3,590
|
|
|
748
|
|
|
4,253
|
|
Transaction
costs
|
569
|
|
|
238
|
|
|
1,175
|
|
|
844
|
|
Business realignment
costs
|
6,204
|
|
|
â
|
|
|
6,204
|
|
|
â
|
|
Goodwill and other
intangible impairment charges
|
51,848
|
|
|
â
|
|
|
51,848
|
|
|
â
|
|
Net (gain) loss on
sale and retirement of assets
|
(265)
|
|
|
(5)
|
|
|
397
|
|
|
282
|
|
Total operating
costs and expenses
|
157,104
|
|
|
103,882
|
|
|
496,295
|
|
|
438,714
|
|
Operating (loss)
income
|
(42,849)
|
|
|
14,768
|
|
|
11,139
|
|
|
77,281
|
|
Other expense
(income):
|
|
|
|
|
|
|
|
Interest expense,
net
|
8,279
|
|
|
8,332
|
|
|
32,753
|
|
|
34,072
|
|
Impairment on
investment
|
â
|
|
|
â
|
|
|
â
|
|
|
4,236
|
|
Repurchase of
debt
|
â
|
|
|
(85)
|
|
|
â
|
|
|
(546)
|
|
Other expense
(income), net
|
99
|
|
|
(312)
|
|
|
288
|
|
|
(665)
|
|
(Loss) income from
continuing operations before income taxes
|
(51,227)
|
|
|
6,833
|
|
|
(21,902)
|
|
|
40,184
|
|
(Benefit) provision
for income taxes
|
(24,956)
|
|
|
3,713
|
|
|
(13,027)
|
|
|
16,982
|
|
Net (loss) income
from continuing operations
|
(26,271)
|
|
|
3,120
|
|
|
(8,875)
|
|
|
23,202
|
|
Net (loss) income
from discontinued operations, net of income taxes
|
(850)
|
|
|
91
|
|
|
(1,398)
|
|
|
91
|
|
Net (loss)
income
|
$
|
(27,121)
|
|
|
$
|
3,211
|
|
|
$
|
(10,273)
|
|
|
$
|
23,293
|
|
The following table reconciles on a GAAP basis net (loss)
income, the most directly comparable financial measure calculated
and presented in accordance with GAAP, to Adjusted Net Income for
the three months and years ended December
31, 2017 and 2016, respectively (in thousands, except per
share data):
|
Three Months
Ended
December
31,
|
|
Years
Ended
December
31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Net (loss)
income
|
$
|
(27,121)
|
|
|
$
|
3,211
|
|
|
$
|
(10,273)
|
|
|
$
|
23,293
|
|
(Benefit)
provision for income taxes
|
(24,956)
|
|
|
3,713
|
|
|
(13,027)
|
|
|
16,982
|
|
(Loss) income
before income taxes
|
(52,077)
|
|
|
6,924
|
|
|
(23,300)
|
|
|
40,275
|
|
Transaction
costs
|
569
|
|
|
238
|
|
|
1,175
|
|
|
844
|
|
Business
realignment costs
|
6,204
|
|
|
â
|
|
|
6,204
|
|
|
â
|
|
Goodwill and other
intangible impairment charges
|
51,848
|
|
|
â
|
|
|
51,848
|
|
|
â
|
|
Impairment on
investment
|
â
|
|
|
â
|
|
|
â
|
|
|
4,236
|
|
Stock option
repricing
|
â
|
|
|
3,435
|
|
|
â
|
|
|
3,435
|
|
Net (gain) loss on
sale and retirement of assets
|
(265)
|
|
|
(5)
|
|
|
397
|
|
|
282
|
|
Repurchase of
debt
|
â
|
|
|
(85)
|
|
|
â
|
|
|
(546)
|
|
Net loss (income)
from discontinued
operations, net of income taxes
|
850
|
|
|
(91)
|
|
|
1,398
|
|
|
(91)
|
|
Adjusted income
before income taxes
|
7,129
|
|
|
10,416
|
|
|
37,722
|
|
|
48,435
|
|
Adjusted
provision for income taxes
|
3,243
|
|
|
5,586
|
|
|
17,160
|
|
|
20,423
|
|
Adjusted Net
Income
|
$
|
3,886
|
|
|
$
|
4,830
|
|
|
$
|
20,562
|
|
|
$
|
28,012
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income
Per Share:
|
|
|
|
|
|
|
|
Basic
|
$
|
0.21
|
|
|
$
|
0.26
|
|
|
$
|
1.11
|
|
|
$
|
1.53
|
|
Diluted
|
$
|
0.14
|
|
|
$
|
0.18
|
|
|
$
|
0.74
|
|
|
$
|
1.03
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
18,478
|
|
|
18,395
|
|
|
18,459
|
|
|
18,255
|
|
Diluted
|
27,457
|
|
|
27,419
|
|
|
27,855
|
|
|
27,313
|
|
The following table reconciles on a GAAP basis net (loss)
income, the most directly comparable financial measure calculated
and presented in accordance with GAAP, to Adjusted EBITDA and
Adjusted EBITDA Less Interest, Capex and Taxes for the three months
and years ended December 31, 2017 and
2016, respectively (dollars in thousands):
|
Three Months
Ended
December 31,
|
|
Years Ended
December 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Net (loss)
income
|
$
|
(27,121)
|
|
|
$
|
3,211
|
|
|
$
|
(10,273)
|
|
|
$
|
23,293
|
|
(Benefit)
provision for income taxes
|
(24,956)
|
|
|
3,713
|
|
|
(13,027)
|
|
|
16,982
|
|
Interest
expense, net
|
8,279
|
|
|
8,332
|
|
|
32,753
|
|
|
34,072
|
|
Transaction
costs
|
569
|
|
|
238
|
|
|
1,175
|
|
|
844
|
|
Depreciation
and amortization
|
5,935
|
|
|
6,159
|
|
|
25,683
|
|
|
23,971
|
|
Stock-based
compensation
|
177
|
|
|
3,590
|
|
|
748
|
|
|
4,253
|
|
Business
realignment costs
|
6,204
|
|
|
â
|
|
|
6,204
|
|
|
â
|
|
Goodwill and other
intangible impairment charges
|
51,848
|
|
|
â
|
|
|
51,848
|
|
|
â
|
|
Impairment on
investment
|
â
|
|
|
â
|
|
|
â
|
|
|
4,236
|
|
Repurchase of
debt
|
â
|
|
|
(85)
|
|
|
â
|
|
|
(546)
|
|
Net loss (income)
from discontinued operations, net of income
taxes
|
850
|
|
|
(91)
|
|
|
1,398
|
|
|
(91)
|
|
Other(a)
|
(166)
|
|
|
(317)
|
|
|
684
|
|
|
(383)
|
|
Adjusted
EBITDA
|
21,619
|
|
|
24,750
|
|
|
97,193
|
|
|
106,631
|
|
Net Cash paid
for interest
|
(11,342)
|
|
|
(12,490)
|
|
|
(29,917)
|
|
|
(32,371)
|
|
Capital
expenditures
|
(4,655)
|
|
|
(3,896)
|
|
|
(22,824)
|
|
|
(20,722)
|
|
Cash paid for
taxes
|
(1,246)
|
|
|
32
|
|
|
(3,170)
|
|
|
(1,878)
|
|
Adjusted EBITDA
Less Interest, Capex and Taxes
|
$
|
4,376
|
|
|
$
|
8,396
|
|
|
$
|
41,282
|
|
|
$
|
51,660
|
|
|
(a) Other includes
net (gain) loss on sale and retirement of assets, (gain) loss on
foreign exchange and other (income) expense, net.
|
The following table reconciles net (loss) income, the most
directly comparable financial measure calculated and presented in
accordance with GAAP, to Adjusted EBITDA on a quarterly basis for
the twelve months ended December 31,
2017 (dollars in thousands):
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
March 31,
2017
|
|
June 30,
2017
|
|
September 30,
2017
|
|
December 31,
2017
|
|
December 31,
2017
|
Net (loss)
income
|
$
|
(3,008)
|
|
|
$
|
5,563
|
|
|
$
|
14,293
|
|
|
$
|
(27,121)
|
|
|
$
|
(10,273)
|
|
(Benefit)
provision for income taxes
|
(1,997)
|
|
|
3,810
|
|
|
10,116
|
|
|
(24,956)
|
|
|
(13,027)
|
|
Interest
expense, net
|
8,254
|
|
|
7,990
|
|
|
8,230
|
|
|
8,279
|
|
|
32,753
|
|
Transaction
costs
|
199
|
|
|
189
|
|
|
218
|
|
|
569
|
|
|
1,175
|
|
Depreciation
and amortization
|
6,383
|
|
|
6,828
|
|
|
6,537
|
|
|
5,935
|
|
|
25,683
|
|
Stock-based
compensation
|
188
|
|
|
183
|
|
|
200
|
|
|
177
|
|
|
748
|
|
Business
realignment costs
|
â
|
|
|
â
|
|
|
â
|
|
|
6,204
|
|
|
6,204
|
|
Goodwill and other
intangible
impairment charges
|
â
|
|
|
â
|
|
|
â
|
|
|
51,848
|
|
|
51,848
|
|
Net loss from
discontinued operations,
net of income taxes
|
165
|
|
|
181
|
|
|
202
|
|
|
850
|
|
|
1,398
|
|
Other(a)
|
31
|
|
|
732
|
|
|
87
|
|
|
(166)
|
|
|
684
|
|
Adjusted
EBITDA
|
$
|
10,215
|
|
|
$
|
25,476
|
|
|
$
|
39,883
|
|
|
$
|
21,619
|
|
|
$
|
97,193
|
|
|
(a) Other includes
net (gain) loss on sale and retirement of assets, (gain) loss on
foreign exchange and other (income) expense, net.
|
The following tables reconcile segment operating income (loss),
the most directly comparable financial measure calculated and
presented in accordance with GAAP, to Adjusted Segment Operating
Income (Loss) for the three months and years ended December 31, 2017 and 2016, respectively (dollars
in thousands):
|
Three Months Ended
December 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Local Marketing
Solutions
|
|
Entertainment
|
|
|
|
|
|
|
|
|
Segment operating
income (loss)
|
$
|
23,788
|
|
|
$
|
28,961
|
|
|
$
|
(58,211)
|
|
|
$
|
(3,473)
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
3,127
|
|
|
3,088
|
|
|
2,269
|
|
|
2,086
|
|
Stock-based
compensation
|
35
|
|
|
768
|
|
|
11
|
|
|
369
|
|
Business realignment
costs
|
â
|
|
|
â
|
|
|
6,204
|
|
|
â
|
|
Goodwill and other
intangible impairment charges
|
2,915
|
|
|
â
|
|
|
48,933
|
|
|
â
|
|
|
|
|
|
|
|
|
|
Adjusted Segment
Operating Income (Loss)
|
$
|
29,865
|
|
|
$
|
32,817
|
|
|
$
|
(794)
|
|
|
$
|
(1,018)
|
|
|
|
|
|
|
Years Ended
December 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Local Marketing
Solutions
|
|
Entertainment
|
|
|
|
|
|
|
|
|
Segment operating
income (loss)
|
$
|
96,631
|
|
|
$
|
105,430
|
|
|
$
|
(55,395)
|
|
|
$
|
4,106
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
14,458
|
|
|
12,612
|
|
|
9,043
|
|
|
8,545
|
|
Stock-based
compensation
|
132
|
|
|
863
|
|
|
101
|
|
|
445
|
|
Business realignment
costs
|
â
|
|
|
â
|
|
|
6,204
|
|
|
â
|
|
Goodwill and other
intangible impairment charges
|
2,915
|
|
|
â
|
|
|
48,933
|
|
|
â
|
|
|
|
|
|
|
|
|
|
Adjusted Segment
Operating Income
|
$
|
114,136
|
|
|
$
|
118,905
|
|
|
$
|
8,886
|
|
|
$
|
13,096
|
|
Reconciliation of Net revenue to Net revenue, excluding
political revenue for the three months and years ended December 31, 2017 and 2016, respectively (dollars
in thousands):
|
Three Months
Ended
December 31,
|
|
%
|
|
Years Ended
December 31,
|
|
%
|
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
Consolidated:
|
|
|
|
|
|
|
|
|
|
Net
revenue
|
$
|
114,255
|
|
$
|
118,650
|
|
(3.7)%
|
|
$
|
507,434
|
|
$
|
515,995
|
|
(1.7)%
|
Less:
Political revenue
|
1,187
|
|
5,320
|
|
(77.7)%
|
|
2,428
|
|
9,017
|
|
(73.1)%
|
Net revenue,
excluding political revenue
|
$
|
113,068
|
|
$
|
113,330
|
|
(0.2)%
|
|
$
|
505,006
|
|
$
|
506,978
|
|
(0.4)%
|
|
|
|
|
|
|
|
|
|
Local Marketing
Solutions Segment:
|
|
|
|
|
|
|
|
|
Net
revenue
|
$
|
91,648
|
|
$
|
91,277
|
|
0.4%
|
|
$
|
348,660
|
|
$
|
342,191
|
|
1.9%
|
Less:
Political revenue
|
1,187
|
|
5,320
|
|
(77.7)%
|
|
2,428
|
|
9,017
|
|
(73.1)%
|
Net revenue,
excluding political revenue
|
$
|
90,461
|
|
$
|
85,957
|
|
5.2%
|
|
$
|
346,232
|
|
$
|
333,174
|
|
3.9%
|
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SOURCE Townsquare Media, Inc.