Cumulus Media Inc. (NASDAQ: CMLS) (the “Company,” "CUMULUS MEDIA,"
“we,” “us,” or “our”) today announced operating results for the
three and six months ended June 30, 2020.
Mary G. Berner, President and Chief Executive Officer of CUMULUS
MEDIA, said, "Despite the COVID-19 pandemic’s material impact on
revenue, the Company generated over $90 million of cash in the
quarter through quick and decisive expense actions, strong working
capital management and the completion of the sale of land in
Bethesda, MD. Ending the quarter with nearly $200 million of cash,
we have also entered into an agreement to monetize our tower
portfolio for more than $210 million, proceeds which will further
add to our liquidity and contribute to significant incremental debt
paydown. Our demonstrated ability to rise to a challenge, strong
liquidity position and resilient balance sheet are critical assets
as we operate through this uncertain environment, and we believe we
remain very well-positioned to drive long-term shareholder value
through continued aggressive debt reduction and the execution of
our growth initiatives."
Key Highlights:
- Meaningfully mitigated pandemic’s Q2 impacts through
significant fixed cost expense reductions
- Nearly $36 million realized in Q2
- Total reductions of more than $85 million expected in 2020
- Delivered sequential monthly revenue and EBITDA improvement
through the quarter
- Continued to deliver profitable growth in digital
- Posted positive EBITDA in June
- Substantially increased liquidity and strengthened balance
sheet
- Grew cash balance to $197 million, up $91 million from Q1
- Achieved net debt reduction of approximately 10% since
March
- Generated $28 million of cash from operations and netted $66
million of additional cash from completion of the sale of land in
Bethesda, MD in Q2
- Maintained balance sheet flexibility with no funded debt
maturity prior to 2026 or financial maintenance covenants
- Executed agreement to monetize tower portfolio and related
assets for $213 million
- Expect funds from deal completion to permit substantial debt
paydown and provide additional liquidity
- Anticipate first closing for 85% or more of proceeds in Q4
Operating Summary (dollars in thousands, except
percentages and per share data):
For the three months ended June 30, 2020, the
Company reported net revenue of $146.0 million, a decrease of
47.8% from the three months ended June 30,
2019, net loss of $36.3 million and Adjusted EBITDA
of $(6.4) million.
For the three months ended June 30, 2020, the Company
reported same station net revenue of $146.0 million, a
decrease of 46.6% from the three months
ended June 30, 2019, and same station Adjusted EBITDA
of $(6.3) million.
For the six months ended June 30, 2020, the
Company reported net revenue of $373.9 million, a decrease of
31.7% from the six months ended June 30, 2019,
net loss of $43.7 million and Adjusted EBITDA
of $21.4 million.
For the six months ended June 30, 2020, the Company
reported same station net revenue of $372.5 million, a
decrease of 29.5% from the six months ended June 30,
2019, and same station Adjusted EBITDA of $22.2 million, a
decrease of 78.3% from the six months ended June 30,
2019.
As Reported |
Three Months Ended June 30, 2020 |
|
Three Months Ended June 30, 2019 |
|
% Change |
Net revenue |
$ |
146,022 |
|
|
$ |
279,673 |
|
|
(47.8 |
)% |
Net (loss) income |
$ |
(36,316 |
) |
|
$ |
42,861 |
|
|
N/A |
Adjusted EBITDA (1) |
$ |
(6,375 |
) |
|
$ |
61,819 |
|
|
N/A |
Basic (loss) income per
share |
$ |
(1.79 |
) |
|
2.13 |
|
|
N/A |
Diluted (loss) income per
share |
$ |
(1.79 |
) |
|
2.11 |
|
|
N/A |
Same Station (2) |
Three Months Ended June 30, 2020 |
|
Three Months Ended June 30, 2019 |
|
% Change |
Net revenue |
$ |
146,012 |
|
|
$ |
273,451 |
|
|
(46.6 |
)% |
Adjusted EBITDA (1) |
$ |
(6,274 |
) |
|
$ |
62,496 |
|
|
N/A |
As Reported |
Six Months Ended June 30, 2020 |
|
Six Months Ended June 30, 2019 |
|
% Change |
Net revenue |
$ |
373,936 |
|
|
$ |
547,169 |
|
|
(31.7 |
)% |
Net (loss) income |
$ |
(43,667 |
) |
|
$ |
43,312 |
|
|
N/A |
Adjusted EBITDA (1) |
$ |
21,350 |
|
|
$ |
103,623 |
|
|
(79.4 |
)% |
Basic (loss) income per
share |
$ |
(2.15 |
) |
|
2.16 |
|
|
N/A |
Diluted (loss) income per
share |
$ |
(2.15 |
) |
|
2.14 |
|
|
N/A |
Same Station (2) |
Six Months Ended June 30, 2020 |
|
Six Months Ended June 30, 2019 |
|
% Change |
Net revenue |
$ |
372,485 |
|
|
$ |
528,511 |
|
|
(29.5 |
)% |
Adjusted EBITDA (1) |
$ |
22,155 |
|
|
$ |
102,266 |
|
|
(78.3 |
)% |
Revenue Detail Summary (dollars in
thousands):
As Reported |
Three Months Ended June 30, 2020 |
|
Three Months Ended June 30, 2019 |
|
% Change |
Broadcast radio
revenue: |
|
|
|
|
|
Spot |
$ |
72,437 |
|
|
$ |
163,111 |
|
|
(55.6 |
)% |
Network |
41,767 |
|
|
72,877 |
|
|
(42.7 |
)% |
Total broadcast radio revenue |
114,204 |
|
|
235,988 |
|
|
(51.6 |
)% |
Digital |
20,341 |
|
|
20,208 |
|
|
0.7 |
% |
Other |
11,477 |
|
|
23,477 |
|
|
(51.1 |
)% |
Net revenue |
$ |
146,022 |
|
|
$ |
279,673 |
|
|
(47.8 |
)% |
Same Station (2) |
Three Months Ended June 30, 2020 |
|
Three Months Ended June 30, 2019 |
|
% Change |
Broadcast radio
revenue: |
|
|
|
|
|
Spot |
$ |
72,466 |
|
|
$ |
158,741 |
|
|
(54.3 |
)% |
Network |
41,767 |
|
|
72,504 |
|
|
(42.4 |
)% |
Total broadcast radio revenue |
114,233 |
|
|
231,245 |
|
|
(50.6 |
)% |
Digital |
20,341 |
|
|
19,636 |
|
|
3.6 |
% |
Other |
11,438 |
|
|
22,570 |
|
|
(49.3 |
)% |
Net revenue |
$ |
146,012 |
|
|
$ |
273,451 |
|
|
(46.6 |
)% |
As Reported |
Six Months Ended June 30, 2020 |
|
Six Months Ended June 30, 2019 |
|
% Change |
Broadcast radio
revenue: |
|
|
|
|
|
Spot |
$ |
194,380 |
|
|
$ |
302,690 |
|
|
(35.8 |
)% |
Network |
107,450 |
|
|
158,041 |
|
|
(32.0 |
)% |
Total broadcast radio revenue |
301,830 |
|
|
460,731 |
|
|
(34.5 |
)% |
Digital |
42,227 |
|
|
37,049 |
|
|
14.0 |
% |
Other |
29,879 |
|
|
49,389 |
|
|
(39.5 |
)% |
Net revenue |
$ |
373,936 |
|
|
$ |
547,169 |
|
|
(31.7 |
)% |
Same Station (2) |
Six Months Ended June 30, 2020 |
|
Six Months Ended June 30, 2019 |
|
% Change |
Broadcast radio
revenue: |
|
|
|
|
|
Spot |
$ |
193,280 |
|
|
$ |
289,565 |
|
|
(33.3 |
)% |
Network |
107,450 |
|
|
156,800 |
|
|
(31.5 |
)% |
Total broadcast radio revenue |
300,730 |
|
|
446,365 |
|
|
(32.6 |
)% |
Digital |
42,156 |
|
|
35,703 |
|
|
18.1 |
% |
Other |
29,599 |
|
|
46,443 |
|
|
(36.3 |
)% |
Net revenue |
$ |
372,485 |
|
|
$ |
528,511 |
|
|
(29.5 |
)% |
Balance Sheet Summary (dollars in
thousands):
|
|
June 30, 2020 |
|
December 31, 2019 |
Cash and cash equivalents |
|
$ |
196,914 |
|
|
$ |
15,142 |
|
Term loan due 2026 (3) |
|
$ |
521,063 |
|
|
$ |
523,688 |
|
6.75% Senior notes (3) |
|
$ |
500,000 |
|
|
$ |
500,000 |
|
2020 Revolving credit
facility |
|
$ |
60,000 |
|
|
$ |
— |
|
|
Six Months Ended June 30, 2020 |
|
Six Months Ended June 30, 2019 |
Capital expenditures |
$ |
5,575 |
|
|
$ |
10,715 |
|
(1) Adjusted EBITDA is not a financial measure calculated or
presented in accordance with GAAP. For additional information, see
“Non-GAAP Financial Measures.”(2) Adjusted for all merger and
acquisition activity occurring in 2019 and 2020 as if such activity
had occurred as of January 1, 2019. Same Station financial measures
are not financial measures calculated or presented in accordance
with accounting principles generally accepted in the United States
of America (“GAAP”). For additional information, see “Non-GAAP
Financial Measures.”(3) Excludes unamortized debt issuance
costs.
Earnings Conference Call DetailsThe Company
will host a conference call today at 8:30 AM EDT to discuss its
second quarter operating results. A link to the webcast of the
conference call will be available on the investor section of the
Company’s website (www.cumulusmedia.com/investors/). The conference
call dial-in number for domestic callers is 877-830-7699 for call
access. If prompted, the conference ID number is 3379889. Please
call five to ten minutes in advance to ensure that you are
connected prior to the call.
Following completion of the call, a recording of the call can be
accessed via a link at www.cumulusmedia.com/investors.
Forward-Looking StatementsCertain statements in
this release may constitute “forward-looking” statements within the
meaning of the Private Securities Litigation Reform Act of 1995 and
other federal securities laws. Such statements are statements other
than historical fact and relate to our intent, belief or current
expectations primarily with respect to our future operating,
financial, and strategic performance. Any such forward-looking
statements are not guarantees of future performance and involve
risks and uncertainties. Actual results may differ from those
contained in or implied by the forward-looking statements as a
result of various factors including, but not limited to, risks and
uncertainties related to the implementation of our strategic
operating plans, the evolving and uncertain nature of the COVID-19
pandemic and its impact on the Company, the media industry, and the
economy in general and other risk factors described from time to
time in our filings with the Securities and Exchange Commission.
Many of these risks and uncertainties are beyond our control, and
the unexpected occurrence or failure to occur of any such events or
matters could significantly alter our actual results of operations
or financial condition. CUMULUS MEDIA assumes no responsibility to
update any forward-looking statements, which are based upon
expectations as of the date hereof, as a result of new information,
future events or otherwise.
About CUMULUS MEDIACUMULUS MEDIA (NASDAQ: CMLS)
is a leading audio-first media and entertainment company delivering
premium content to over a quarter billion people every month -
wherever and whenever they want it. CUMULUS MEDIA engages listeners
with high-quality local programming through 424 owned-and-operated
stations across 87 markets; delivers nationally-syndicated sports,
news, talk, and entertainment programming from iconic brands
including the NFL, the NCAA, the Masters, the Olympics, the Academy
of Country Music Awards, and many other world-class partners across
nearly 8,000 affiliated stations through Westwood One, the largest
audio network in America; and inspires listeners through its
rapidly growing network of original podcasts that are smart,
entertaining and thought-provoking. CUMULUS MEDIA provides
advertisers with personal connections, local impact and national
reach through on-air and on-demand digital, mobile, social,
and voice-activated platforms, as well as integrated digital
marketing services, powerful influencers, full-service audio
solutions, industry-leading research and insights, and live
event experiences. CUMULUS MEDIA is the only audio media
company to provide marketers with local and national advertising
performance guarantees. For more information
visit www.cumulusmedia.com.
Non-GAAP Financial Measures
From time to time, we utilize certain financial measures that
are not prepared or calculated in accordance with GAAP to assess
our financial performance and profitability. Consolidated adjusted
earnings before interest, taxes, depreciation, and amortization
("Adjusted EBITDA") is the financial metric by which management and
the chief operating decision maker allocate resources of the
Company and analyze the performance of the Company as a whole.
Management also uses this measure to determine the contribution of
our core operations to the funding of our corporate resources
utilized to manage our operations and the funding of our
non-operating expenses including debt service and acquisitions.
In determining Adjusted EBITDA, the Company excludes from net
income items not related to core operations and those that are
non-cash including: interest, taxes, depreciation, amortization,
stock-based compensation expense, gain or loss on the exchange,
sale or disposal of any assets or stations, early extinguishment of
debt, local marketing agreement fees, expenses relating to
acquisitions, divestitures, restructuring costs, reorganization
items and non-cash impairments of assets, if any.
Because of the significant effect that the Company’s material
station acquisitions and dispositions have had on our results of
operations, the Company also presents certain financial
information herein on a “Same Station” basis, both with and
excluding the effect of political advertising in order to address
the cyclical nature of the two-year election cycle. Same Station
metrics are adjusted for material station acquisitions and
dispositions as if these acquisitions and dispositions had occurred
as of the beginning of the comparable period in the prior year, as
indicated. Same station financial measures excluding the impact of
political advertising are further adjusted to exclude the impact of
political advertising in the comparable periods.
Management believes that Adjusted EBITDA and Same Station
financial measures, with and excluding the impact of political
advertising, although not measures that are calculated in
accordance with GAAP, are commonly employed by the investment
community as measures for determining the market value of a media
company and comparing the operational and financial performance
among media companies. Management has also observed that Adjusted
EBITDA and Same Station financial measures, with and excluding the
impact of political advertising, are routinely utilized to evaluate
and negotiate the potential purchase price for media companies.
Given the relevance to our overall value, management believes that
investors consider the metrics to be extremely useful.
Adjusted EBITDA and Same Station financial measures, with and
excluding the impact of political advertising, should not be
considered in isolation or as a substitute for net income, net
revenue, operating income, cash flows from operating activities or
any other measure for determining the Company’s operating
performance or liquidity that is calculated in accordance with
GAAP. In addition, Adjusted EBITDA and Same Station financial
measures, both with and excluding the impact of political
advertising, may be defined or calculated differently by other
companies and, therefore, comparability may be limited.
For further information, please
contact:Cumulus Media Inc.Investor
Relations DepartmentIR@cumulus.com404-260-6600Supplemental
Financial Data and Reconciliations
CUMULUS MEDIA
INC.Unaudited Condensed Consolidated Statements of
Operations(Dollars in thousands)
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, 2020 |
|
June 30, 2019 |
|
June 30, 2020 |
|
June 30, 2019 |
Net revenue |
|
$ |
146,022 |
|
|
$ |
279,673 |
|
|
$ |
373,936 |
|
|
$ |
547,169 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
Content costs |
|
65,725 |
|
|
93,844 |
|
|
154,291 |
|
|
197,596 |
|
Selling, general & administrative expenses |
|
79,904 |
|
|
115,817 |
|
|
183,531 |
|
|
229,320 |
|
Depreciation and amortization |
|
13,122 |
|
|
13,545 |
|
|
25,912 |
|
|
28,135 |
|
Local marketing agreement fees |
|
1,006 |
|
|
438 |
|
|
2,053 |
|
|
1,481 |
|
Corporate expenses |
|
7,003 |
|
|
8,545 |
|
|
15,172 |
|
|
17,077 |
|
Stock-based compensation expense |
|
985 |
|
|
1,106 |
|
|
1,704 |
|
|
2,314 |
|
Restructuring costs |
|
2,343 |
|
|
13,024 |
|
|
5,263 |
|
|
15,801 |
|
Loss (gain) on sale of assets or stations |
|
3,767 |
|
|
(47,750 |
) |
|
5,583 |
|
|
(47,724 |
) |
Impairment of intangible assets |
|
4,509 |
|
|
— |
|
|
4,509 |
|
|
— |
|
Total operating expenses |
|
178,364 |
|
|
198,569 |
|
|
398,018 |
|
|
444,000 |
|
Operating (loss) income |
|
(32,342 |
) |
|
81,104 |
|
|
(24,082 |
) |
|
103,169 |
|
Non-operating expense: |
|
|
|
|
|
|
|
|
Interest expense |
|
(15,888 |
) |
|
(21,191 |
) |
|
(33,047 |
) |
|
(43,347 |
) |
Interest income |
|
2 |
|
|
8 |
|
|
4 |
|
|
12 |
|
Gain on early extinguishment of debt |
|
— |
|
|
— |
|
|
— |
|
|
381 |
|
Other expense, net |
|
(61 |
) |
|
(34 |
) |
|
(64 |
) |
|
(62 |
) |
Total non-operating expense, net |
|
(15,947 |
) |
|
(21,217 |
) |
|
(33,107 |
) |
|
(43,016 |
) |
(Loss) income before income taxes |
|
(48,289 |
) |
|
59,887 |
|
|
(57,189 |
) |
|
60,153 |
|
Income tax benefit
(expense) |
|
11,973 |
|
|
(17,026 |
) |
|
13,522 |
|
|
(16,841 |
) |
Net (loss) income |
|
$ |
(36,316 |
) |
|
$ |
42,861 |
|
|
$ |
(43,667 |
) |
|
$ |
43,312 |
|
The following tables reconcile net (loss) income, the most
directly comparable financial measure calculated and presented in
accordance with GAAP, to Adjusted EBITDA for the periods presented
herein (dollars in
thousands):
As Reported |
|
Three Months Ended June 30, 2020 |
|
Three Months Ended June 30, 2019 |
GAAP net (loss) income |
|
$ |
(36,316 |
) |
|
$ |
42,861 |
|
Income tax (benefit) expense |
|
(11,973 |
) |
|
17,026 |
|
Non-operating expense, including net interest expense |
|
15,947 |
|
|
21,217 |
|
Local marketing agreement fees |
|
1,006 |
|
|
438 |
|
Depreciation and amortization |
|
13,122 |
|
|
13,545 |
|
Stock-based compensation expense |
|
985 |
|
|
1,106 |
|
Loss (gain) on sale of assets or stations |
|
3,767 |
|
|
(47,750 |
) |
Impairment of intangible assets |
|
4,509 |
|
|
— |
|
Restructuring costs |
|
2,343 |
|
|
13,024 |
|
Franchise taxes |
|
235 |
|
|
352 |
|
Adjusted EBITDA |
|
$ |
(6,375 |
) |
|
$ |
61,819 |
|
Same Station (1) |
|
Three Months Ended June 30, 2020 |
|
Three Months Ended June 30, 2019 |
Net (loss) income |
|
$ |
(36,454 |
) |
|
$ |
45,703 |
|
Income tax (benefit) expense |
|
(11,973 |
) |
|
17,026 |
|
Non-operating expense, including net interest expense |
|
15,947 |
|
|
21,217 |
|
Local marketing agreement fees |
|
1,006 |
|
|
438 |
|
Depreciation and amortization |
|
13,108 |
|
|
13,471 |
|
Stock-based compensation expense |
|
985 |
|
|
1,106 |
|
Loss (gain) on sale of assets or stations |
|
4,076 |
|
|
(49,841 |
) |
Impairment of intangible assets |
|
4,509 |
|
|
— |
|
Restructuring costs |
|
2,287 |
|
|
13,024 |
|
Franchise taxes |
|
235 |
|
|
352 |
|
Adjusted EBITDA |
|
$ |
(6,274 |
) |
|
$ |
62,496 |
|
As Reported |
|
Six Months Ended June 30, 2020 |
|
Six Months Ended June 30, 2019 |
GAAP net loss |
|
$ |
(43,667 |
) |
|
$ |
43,312 |
|
Income tax (benefit) expense |
|
(13,522 |
) |
|
16,841 |
|
Non-operating expense, including net interest expense |
|
33,107 |
|
|
43,397 |
|
Local marketing agreement fees |
|
2,053 |
|
|
1,481 |
|
Depreciation and amortization |
|
25,912 |
|
|
28,135 |
|
Stock-based compensation expense |
|
1,704 |
|
|
2,314 |
|
Loss (gain) on sale of assets or stations |
|
5,583 |
|
|
(47,724 |
) |
Impairment of intangible assets |
|
4,509 |
|
|
— |
|
Restructuring costs |
|
5,263 |
|
|
15,801 |
|
Franchise taxes |
|
408 |
|
|
447 |
|
Gain on early extinguishment of debt |
|
— |
|
|
(381 |
) |
Adjusted EBITDA |
|
$ |
21,350 |
|
|
$ |
103,623 |
|
Same Station (1) |
|
Six Months Ended June 30, 2020 |
|
Six Months Ended June 30, 2019 |
Net (loss) income |
|
$ |
(41,706 |
) |
|
$ |
44,361 |
|
Income tax (benefit) expense |
|
(13,522 |
) |
|
16,841 |
|
Non-operating expense, including net interest expense |
|
33,107 |
|
|
43,397 |
|
Local marketing agreement fees |
|
2,053 |
|
|
1,481 |
|
Depreciation and amortization |
|
25,738 |
|
|
27,828 |
|
Stock-based compensation expense |
|
1,704 |
|
|
2,314 |
|
Loss (gain) on sale of assets or stations |
|
4,690 |
|
|
(49,823 |
) |
Impairment of intangible assets |
|
4,509 |
|
|
— |
|
Restructuring costs |
|
5,174 |
|
|
15,801 |
|
Franchise taxes |
|
408 |
|
|
447 |
|
Gain on early
extinguishment of debt |
|
— |
|
|
(381 |
) |
Adjusted EBITDA |
|
$ |
22,155 |
|
|
$ |
102,266 |
|
The following tables reconcile as reported net revenue and as
reported Adjusted EBITDA to same station net revenue and same
station Adjusted EBITDA, both including and excluding the impact of
political, for the periods presented herein (dollars in
thousands):
|
|
Three Months Ended June 30, 2020 |
|
Three Months Ended June 30, 2019 |
As reported net revenue |
|
$ |
146,022 |
|
|
$ |
279,673 |
|
Station dispositions and swaps |
|
(10 |
) |
|
(6,222 |
) |
Same station net revenue |
|
$ |
146,012 |
|
|
$ |
273,451 |
|
Political revenue |
|
(1,183 |
) |
|
(810 |
) |
Same station net revenue,
excluding impact of political revenue |
|
$ |
144,829 |
|
|
$ |
272,641 |
|
|
|
Three Months Ended June 30, 2020 |
|
Three Months Ended June 30, 2019 |
As reported Adjusted
EBITDA |
|
$ |
(6,375 |
) |
|
$ |
61,819 |
|
Station dispositions and swaps |
|
101 |
|
|
677 |
|
Same station Adjusted
EBITDA |
|
$ |
(6,274 |
) |
|
$ |
62,496 |
|
Political EBITDA |
|
(1,065 |
) |
|
(729 |
) |
Same station Adjusted EBITDA,
excluding impact of political EBITDA |
|
$ |
(7,339 |
) |
|
$ |
61,767 |
|
|
|
Six Months Ended June 30, 2020 |
|
Six Months Ended June 30, 2019 |
As reported net revenue |
|
$ |
373,936 |
|
|
$ |
547,169 |
|
Station dispositions and swaps |
|
(1,451 |
) |
|
(18,658 |
) |
Same station net revenue |
|
$ |
372,485 |
|
|
$ |
528,511 |
|
Political revenue |
|
(6,109 |
) |
|
(1,693 |
) |
Same station net revenue,
excluding impact of political revenue |
|
$ |
366,376 |
|
|
$ |
526,818 |
|
|
|
Six Months Ended June 30, 2020 |
|
Six Months Ended June 30, 2019 |
As reported Adjusted
EBITDA |
|
$ |
21,350 |
|
|
$ |
103,623 |
|
Station dispositions and swaps |
|
805 |
|
|
(1,357 |
) |
Same station Adjusted
EBITDA |
|
$ |
22,155 |
|
|
$ |
102,266 |
|
Political EBITDA |
|
(5,498 |
) |
|
(1,524 |
) |
Same station Adjusted EBITDA,
excluding impact of political EBITDA |
|
$ |
16,657 |
|
|
$ |
100,742 |
|
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