Townsquare Media, Inc. (NYSE: TSQ) (“Townsquare”, the "Company,"
"we," "us," or "our") announced today its financial results for the
first quarter ended March 31, 2024.
“I am pleased to share that Townsquare’s first
quarter results met our previously issued guidance, and that we are
building momentum and gaining market share, primarily due to our
local focus and our unique and differentiated digital platform.
First quarter net revenue decreased -3.4% year-over-year and
Adjusted EBITDA decreased -9.9% year-over-year, both in-line with
our expectations. Our first quarter performance improved over the
fourth quarter across each of our segments. Importantly, our
Digital Advertising segment returned to revenue growth in the first
quarter (+1.3% year-over-year), and our Townsquare Interactive
segment achieved net subscriber growth and month-over-month revenue
growth in March, a meaningful turning point for the business. In
total, Digital represented 53% of Townsquare’s first quarter 2024
net revenue and Adjusted Operating Income,” commented Bill Wilson,
Chief Executive Officer of Townsquare Media, Inc. “The strong cash
generation characteristics of our assets provided us the ability to
execute two attractive equity transactions in April using cash on
hand: the accretive share repurchase of 1.5 million shares
from MSG at an 11% discount to the pre-announcement share price,
and an option buyout at an attractive price point, thereby avoiding
shareholder dilution. In addition, during the quarter we
repurchased $4 million of our common stock, and paid a
high-yielding dividend while also investing in our business. We
ended the quarter with a strong cash balance of $57 million, and
following the April equity transactions, maintained a cash balance
of $28 million at the end of April, retaining financial
flexibility moving forward.”
Mr. Wilson continued, “Our performance and
building momentum reinforces my confidence in our Digital First
Local Media strategy, our focus on markets outside of the Top 50
U.S. cities, and our path moving forward. I am pleased to share
that others share this view as well. Boyar Research, founded in
1975 and a leading firm of in-depth, independent research on
publicly traded U.S. companies, highlighted Townsquare as their
“Opportunity Pick” in March 2024, and in their report they derive
an intrinsic value of Townsquare of $25.30 per share based on a
sum-of-the-parts valuation. They also invited me to be a guest on
their podcast, “The World According to Boyar”. Both the report and
the podcast are available to our current and prospective investors
on our website.”
“Townsquare’s differentiated Digital Advertising
platform has already returned to growth, Townsquare Interactive is
solidly on the path to recovery, and our mature, cash cow Broadcast
Advertising platform has and continues to generate a solid profit,
contributing to our strong cash generation. Due to our current cash
position and our strong cash generation, we retain financial
flexibility moving forward and we are confident in our ability to
build shareholder value for our investors through long-term net
revenue, Adjusted EBITDA and cash flow growth, net leverage
reduction, future dividend payments, and potential future share
repurchases,” concluded Mr. Wilson.
The Company announced today that its Board of
Directors approved a quarterly cash dividend of $0.1975 per share.
The dividend will be payable on August 1, 2024 to shareholders of
record as of the close of business on July 15, 2024. As of
yesterday’s closing price that reflects a dividend yield of
approximately 6%.
Segment ReportingWe have three
reportable operating segments, Subscription Digital Marketing
Solutions, Digital Advertising and Broadcast Advertising. The
Subscription Digital Marketing Solutions segment includes our
subscription digital marketing solutions business, Townsquare
Interactive. The Digital Advertising segment, marketed externally
as Townsquare Ignite, includes digital advertising on our owned and
operated digital properties, our first party data digital
management platform and our digital programmatic advertising
platform. The Broadcast Advertising segment includes our local,
regional, and national advertising products and solutions delivered
via terrestrial radio broadcast, and other miscellaneous revenue
that is associated with our broadcast advertising platform. The
remainder of our business is reported in the Other category, which
includes our live events business.
First Quarter Results*
- As compared to the first quarter of 2023:
- Net revenue decreased 3.4%, and 4.2% excluding political
- Net income increased $3.5 million
- Adjusted EBITDA decreased 9.9%
- Total Digital net revenue decreased 5.2%
- Subscription Digital Marketing Solutions (“Townsquare
Interactive”) net revenue decreased 15.3%
- Digital Advertising net revenue increased 1.3%
- Total Digital Adjusted Operating Income decreased 22.8%
- Subscription Digital Marketing Solutions Adjusted Operating
Income decreased 9.7%
- Digital Advertising Adjusted Operating Income decreased
30.1%
- Broadcast Advertising net revenue decreased 1.0%, and decreased
2.8% excluding political
- Diluted income per share was $0.06
- Repurchased 0.4 million shares of the Company’s common stock at
an average price of $10.80
- In April 2024, repurchased and retired 1.5 million shares of
the Company's common stock at an average price of $9.76 per
share
- In April 2024, purchased and retired 3.2 million options
expiring in July 2024 for a net purchase price of $3.61 per
option
*See below for discussion of non-GAAP
measures.
GuidanceFor the second quarter
of 2024, net revenue is expected to be between $117.5 million and
$119.0 million, and Adjusted EBITDA is expected to be between $26.0
million and $27.0 million.
For the full year 2024, net revenue guidance is
reaffirmed to be between $440 million and $460 million, and
Adjusted EBITDA guidance is reaffirmed to be between $100 million
and $110 million.
Quarter Ended
March 31, 2024 Compared to the
Quarter Ended March 31, 2023
Net RevenueNet revenue for the
three months ended March 31, 2024 decreased $3.5 million, or 3.4%,
to $99.6 million as compared to $103.1 million in the same period
in 2023. Subscription Digital Marketing Solutions net revenue
decreased $3.3 million, or 15.3%, Broadcast Advertising net revenue
decreased $0.5 million, or 1.0%, and Other net revenue decreased
$0.2 million, or 7.8%, as compared to the same period in 2023.
Digital Advertising net revenue increased $0.4 million, or 1.3%, as
compared to the same period in 2023. Excluding political revenue of
$1.1 million and $0.2 million for the three months ended March 31,
2024 and 2023, respectively, net revenue decreased $4.3 million, or
4.2%, to $98.6 million, Broadcast Advertising net revenue decreased
$1.3 million, or 2.8%, to $44.5 million, and Digital Advertising
net revenue increased $0.4 million, or 1.2%, to $34.1 million.
Net Income (Loss)For the three
months ended March 31, 2024, we reported net income of
$1.6 million, as compared to a net loss of $1.9 million
in the same period last year. The increase was primarily due to a
$6.9 million decrease in non-cash impairment charges, a $3.1
million increase in Other income and a $1.4 million decrease in
direct operating expenses, partially offset by a $3.5 million
decrease in net revenue, a $1.2 million increase in transaction and
business realignment costs, and a $1.1 million increase in
stock-based compensation.
Adjusted EBITDAAdjusted EBITDA
for the three months ended March 31, 2024 decreased
$1.9 million, or 9.9%, to $17.5 million, as compared to $19.4
million in the same period last year. Adjusted EBITDA (Excluding
Political) decreased $2.6 million, or 13.7%, to $16.6 million,
as compared to $19.3 million in the same period last year.
Liquidity and Capital
ResourcesAs of March 31, 2024, we had a total of
$56.6 million of cash and cash equivalents and
$503.6 million of outstanding indebtedness, representing 5.13x
and 4.56x gross and net leverage, respectively, based on Adjusted
EBITDA for the twelve months ended March 31, 2024, of
$98.1 million.
The table below presents a summary, as of
May 6, 2024, of our outstanding common stock.
Security |
|
Number Outstanding |
|
Description |
Class A common stock |
|
14,305,687 |
|
One vote per share. |
Class B common stock |
|
815,296 |
|
10 votes per share.1 |
Total |
|
15,120,983 |
|
|
1 Each share converts into one share of Class A common stock upon
transfer or at the option of the holder, subject to certain
conditions, including compliance with FCC rules. |
Conference CallTownsquare
Media, Inc. will host a conference call to discuss certain first
quarter 2024 financial results and 2024 guidance on Thursday,
May 9, 2024 at 8:00 a.m. Eastern Time. The conference call
dial-in number is 1-888-886-7786 (U.S. & Canada) or
1-416-764-8658 (International) and the confirmation code is
03705452. A live webcast of the conference call will also be
available on the investor relations page of the Company’s website
at www.townsquaremedia.com.
A replay of the conference call will be
available through May 16, 2024. To access the replay, please dial
1-844-512-2921 (U.S. and Canada) or 1-412-317-6671 (International)
and enter confirmation code 03705452. A web-based archive of the
conference call will also be available at the above website.
About Townsquare Media,
Inc.Townsquare is a community-focused
digital media and digital marketing solutions company with market
leading local radio stations, principally focused outside the top
50 markets in the U.S. Our assets include a subscription digital
marketing services business, Townsquare
Interactive, providing website design, creation and
hosting, search engine optimization, social media and online
reputation management as well as other digital monthly services for
approximately 23,300 SMBs; a robust digital advertising division,
Townsquare Ignite, a powerful combination of a) an
owned and operated portfolio of more than 400 local news and
entertainment websites and mobile apps along with a network of
leading national music and entertainment brands, collecting
valuable first party data and b) a proprietary digital programmatic
advertising technology stack with an in-house demand and data
management platform; and a portfolio of 349 local terrestrial radio
stations in 74 U.S. markets strategically situated outside the Top
50 markets in the United States. Our portfolio includes local media
brands such as WYRK.com, WJON.com and NJ101.5.com, and premier
national music brands such as XXLmag.com, TasteofCountry.com,
UltimateClassicRock.com, and Loudwire.com. For more information,
please visit www.townsquaremedia.com,
www.townsquareinteractive.com and
www.townsquareignite.com.
Forward-Looking
StatementsExcept 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. Actual events or results may differ materially from the
results anticipated in these forward-looking statements as a result
of a variety of factors. While it is impossible to identify all
such factors, factors that could cause actual results to differ
materially from those estimated by us include the impact of general
economic conditions in the United States, or in the specific
markets in which we currently do business including supply
chain disruptions, inflation, labor shortages and the effect on
advertising activity, industry conditions, including existing
competition and future competitive technologies, the popularity of
radio as a broadcasting and advertising medium, cancellations,
disruptions or postponements of advertising schedules in response
to national or world events, our ability to develop and
maintain digital technologies and hire and retain technical and
sales talent, our dependence on key personnel, our capital
expenditure requirements, our continued ability to identify
suitable acquisition targets, and consummate and integrate any
future acquisitions, legislative or regulatory requirements, risks
and uncertainties relating to our leverage and changes in interest
rates, our ability to obtain financing at times, in amounts and at
rates considered appropriate by us, our ability to access the
capital markets as and when needed and on terms that we
consider favorable to us and other factors discussed in this
section entitled “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” in this report and under “Risk
Factors” in our 2023 Annual Report on Form 10-K, for the year ended
December 31, 2023, filed with the SEC on March 15, 2024, as well as
other risks discussed from time to time in our filings with the
SEC. Many of these factors are beyond our ability to predict or
control. In addition, as a result of these and other factors, our
past financial performance should not be relied on as an indication
of future performance. The cautionary statements referred to in
this section also should be considered in connection with any
subsequent written or oral forward-looking statements that may be
issued by us or persons acting on our behalf. The forward-looking
statements included in this report are made only as of the date
hereof or as of the date specified herein. We undertake no
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by law.
Non-GAAP Financial Measures and
DefinitionsIn this press release, we refer to Adjusted
Operating Income, Adjusted EBITDA, Adjusted EBITDA (Excluding
Political), Adjusted Net Income and Adjusted Net Income Per Share
which are financial measures that have not been prepared in
accordance with generally accepted accounting principles in the
United States (“GAAP”).
We define Adjusted Operating Income as operating
income before the deduction of depreciation and amortization,
stock-based compensation, corporate expenses, transaction costs,
business realignment costs, impairments and net loss (gain) on sale
and retirement of assets. We define Adjusted EBITDA as net income
before the deduction of income taxes, interest expense, net, gain
on repurchases of debt, transaction and business realignment costs,
depreciation and amortization, stock-based compensation,
impairments, net loss (gain) on sale and retirement of assets and
other expense (income) net. We define Adjusted EBITDA (Excluding
Political) as Adjusted EBITDA less political net revenue, net of a
fifteen percent deduction to account for estimated national
representative firm fees, music licensing fees and sales
commissions expense. Adjusted Net Income is defined as net income
before the deduction of transaction and business realignment costs,
impairments, gain on sale of investment, change in fair value of
investment, net loss (gain) on sale and retirement of assets, gain
on repurchases of debt, gain on sale of digital assets, gain on
insurance recoveries and net income attributable to non-controlling
interest, net of income taxes stated at the Company's applicable
statutory effective tax rate. Adjusted Net Income Per Share is
defined as Adjusted Net Income divided by the weighted average
shares outstanding. We define Net Leverage as our total outstanding
indebtedness, net of our total cash balance as of March 31,
2024, divided by our Adjusted EBITDA for the twelve months ended
March 31, 2024. These measures do not represent, and should
not be considered as alternatives to or superior to, financial
results and measures determined or calculated in accordance with
GAAP. In addition, these non-GAAP measures are not based on any
comprehensive set of accounting rules or principles. You should be
aware that in the future we may incur expenses or charges that are
the same as or similar to some of the adjustments in the
presentation, and we do not infer that our future results will be
unaffected by unusual or non-recurring items. In addition, these
non-GAAP measures may not be comparable to similarly-named measures
reported by other companies.
We use Adjusted Operating Income to evaluate the
operating performance of our business segments. We use Adjusted
EBITDA and Adjusted EBITDA (Excluding Political) 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, and to facilitate year
over year comparisons, by backing out the impact of political
revenue which varies depending on the election cycle and may be
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 Net Leverage to measure
the Company’s ability to handle its debt burden. 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, business
realignment costs and certain impairments. Further, while
discretionary bonuses for members of management are not determined
with reference to specific targets, our board of directors may
consider Adjusted Operating Income, Adjusted EBITDA, Adjusted
EBITDA (Excluding Political), Adjusted Net Income, Adjusted Net
Income Per Share, and Net Leverage when determining discretionary
bonuses.
Investor RelationsClaire
Yenicay(203) 900-5555investors@townsquaremedia.com
TOWNSQUARE MEDIA, INC.CONSOLIDATED
BALANCE SHEETS(in Thousands, Except Share and Per
Share Data)(unaudited) |
|
March 31,2024 |
|
December 31,2023 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
56,600 |
|
|
$ |
61,046 |
|
Accounts receivable, net of allowance for credit losses of $4,156
and $4,041, respectively |
|
53,894 |
|
|
|
60,780 |
|
Prepaid expenses and other current assets |
|
10,823 |
|
|
|
10,356 |
|
Total current assets |
|
121,317 |
|
|
|
132,182 |
|
Property and equipment,
net |
|
110,580 |
|
|
|
110,194 |
|
Intangible assets, net |
|
197,168 |
|
|
|
200,306 |
|
Goodwill |
|
157,270 |
|
|
|
157,270 |
|
Investments |
|
3,309 |
|
|
|
3,542 |
|
Operating lease right-of-use
assets |
|
45,732 |
|
|
|
46,887 |
|
Other assets |
|
819 |
|
|
|
1,165 |
|
Restricted cash |
|
505 |
|
|
|
503 |
|
Total assets |
$ |
636,700 |
|
|
$ |
652,049 |
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
4,545 |
|
|
$ |
5,036 |
|
Deferred revenue |
|
9,814 |
|
|
|
9,059 |
|
Accrued compensation and benefits |
|
14,355 |
|
|
|
13,085 |
|
Accrued expenses and other current liabilities |
|
25,293 |
|
|
|
25,112 |
|
Operating lease liabilities, current |
|
9,549 |
|
|
|
9,376 |
|
Accrued interest |
|
5,782 |
|
|
|
14,420 |
|
Total current liabilities |
|
69,338 |
|
|
|
76,088 |
|
Long-term debt, net of
deferred finance costs of $3,513 and $3,960, respectively |
|
500,105 |
|
|
|
499,658 |
|
Deferred tax liability |
|
11,864 |
|
|
|
11,856 |
|
Operating lease liability, net
of current portion |
|
41,089 |
|
|
|
41,437 |
|
Other long-term
liabilities |
|
12,464 |
|
|
|
13,099 |
|
Total liabilities |
|
634,860 |
|
|
|
642,138 |
|
Stockholders’ equity: |
|
|
|
Class A common stock, par value $0.01 per share; 300,000,000 shares
authorized; 16,431,150 and 14,023,767 shares issued and
outstanding, respectively |
|
164 |
|
|
|
140 |
|
Class B common stock, par value $0.01 per share; 50,000,000 shares
authorized; 815,296 and 815,296 shares issued and outstanding,
respectively |
|
8 |
|
|
|
8 |
|
Class C common stock, par value $0.01 per share; 50,000,000 shares
authorized; 0 and 1,961,341 shares issued and outstanding,
respectively |
|
— |
|
|
|
20 |
|
Total common stock |
|
172 |
|
|
|
168 |
|
Treasury stock, at cost; 580,527 and 183,768 shares of Class A
common stock, respectively |
|
(6,476 |
) |
|
|
(2,177 |
) |
Additional paid-in capital |
|
308,441 |
|
|
|
310,612 |
|
Accumulated deficit |
|
(304,215 |
) |
|
|
(302,193 |
) |
Non-controlling interest |
|
3,918 |
|
|
|
3,501 |
|
Total stockholders’ equity |
|
1,840 |
|
|
|
9,911 |
|
Total liabilities and stockholders’ equity |
$ |
636,700 |
|
|
$ |
652,049 |
|
TOWNSQUARE MEDIA, INC.CONSOLIDATED
STATEMENTS OF OPERATIONS(in Thousands, Except Per
Share Data)(unaudited) |
|
Three Months Ended March
31, |
|
|
2024 |
|
|
|
2023 |
|
Net revenue |
$ |
99,633 |
|
|
$ |
103,110 |
|
Operating costs and
expenses: |
|
|
|
Direct operating expenses, excluding depreciation, amortization,
and stock-based compensation |
|
76,895 |
|
|
|
78,324 |
|
Depreciation and amortization |
|
4,935 |
|
|
|
4,944 |
|
Corporate expenses |
|
5,217 |
|
|
|
5,345 |
|
Stock-based compensation |
|
2,870 |
|
|
|
1,772 |
|
Transaction and business realignment costs |
|
1,444 |
|
|
|
292 |
|
Impairment of intangible and long-lived assets |
|
1,618 |
|
|
|
8,487 |
|
Net loss (gain) on sale and retirement of assets |
|
14 |
|
|
|
(292 |
) |
Total operating costs and expenses |
|
92,993 |
|
|
|
98,872 |
|
Operating income |
|
6,640 |
|
|
|
4,238 |
|
Other expense (income): |
|
|
|
Interest expense, net |
|
9,031 |
|
|
|
9,558 |
|
Gain on repurchases of debt |
|
— |
|
|
|
(775 |
) |
Other income, net |
|
(4,151 |
) |
|
|
(1,026 |
) |
Income (loss) from operations before tax |
|
1,760 |
|
|
|
(3,519 |
) |
Income tax provision (benefit) |
|
207 |
|
|
|
(1,578 |
) |
Net income (loss) |
$ |
1,553 |
|
|
$ |
(1,941 |
) |
|
|
|
|
Net income (loss)
attributable to: |
|
|
|
Controlling interests |
$ |
1,136 |
|
|
$ |
(2,421 |
) |
Non-controlling interests |
|
417 |
|
|
|
480 |
|
Net income (loss) |
$ |
1,553 |
|
|
$ |
(1,941 |
) |
|
|
|
|
Basic income (loss)
per share |
$ |
0.07 |
|
|
$ |
(0.14 |
) |
|
|
|
|
Diluted income (loss)
per share |
$ |
0.06 |
|
|
$ |
(0.14 |
) |
|
|
|
|
Weighted average
shares outstanding: |
|
|
|
Basic |
|
16,562 |
|
|
|
17,204 |
|
Diluted |
|
18,762 |
|
|
|
17,204 |
|
TOWNSQUARE MEDIA, INC.CONSOLIDATED
STATEMENTS OF CASH FLOWS (in
Thousands)(unaudited) |
|
Three Months Ended March 31, |
|
|
2024 |
|
|
|
2023 |
|
Cash flows from operating
activities: |
|
|
|
Net income (loss) |
$ |
1,553 |
|
|
$ |
(1,941 |
) |
Adjustments to reconcile net
income (loss) to net cash provided by operating activities: |
|
|
|
Depreciation and amortization |
|
4,935 |
|
|
|
4,944 |
|
Amortization of deferred financing costs |
|
447 |
|
|
|
425 |
|
Non-cash lease expense |
|
1 |
|
|
|
41 |
|
Net deferred taxes and other |
|
8 |
|
|
|
(1,766 |
) |
Allowance for credit losses |
|
1,260 |
|
|
|
1,323 |
|
Stock-based compensation expense |
|
2,870 |
|
|
|
1,772 |
|
Gain on repurchases of debt |
|
— |
|
|
|
(775 |
) |
Trade and barter activity, net |
|
(195 |
) |
|
|
(454 |
) |
Impairment of intangible and long-lived assets |
|
1,618 |
|
|
|
8,487 |
|
Realized gain on sale of digital assets |
|
— |
|
|
|
(839 |
) |
Gain on sale of investment |
|
(4,009 |
) |
|
|
— |
|
Unrealized loss on investment |
|
233 |
|
|
|
134 |
|
Amortization of content rights |
|
1,222 |
|
|
|
1,200 |
|
Change in content rights liabilities |
|
(1,200 |
) |
|
|
258 |
|
Other |
|
1,210 |
|
|
|
(555 |
) |
Changes in assets and
liabilities, net of acquisitions: |
|
|
|
Accounts receivable |
|
5,390 |
|
|
|
5,058 |
|
Prepaid expenses and other assets |
|
71 |
|
|
|
4,465 |
|
Accounts payable |
|
(513 |
) |
|
|
(22 |
) |
Accrued expenses |
|
(4,589 |
) |
|
|
(3,134 |
) |
Accrued interest |
|
(8,638 |
) |
|
|
(9,258 |
) |
Other long-term liabilities |
|
(3 |
) |
|
|
(8 |
) |
Net cash provided by operating activities |
|
1,671 |
|
|
|
9,355 |
|
Cash flows from investing
activities: |
|
|
|
Purchase of property and equipment |
|
(4,428 |
) |
|
|
(3,639 |
) |
Proceeds from sale of digital assets |
|
— |
|
|
|
2,975 |
|
Proceeds from sale of assets and investment related
transactions |
|
4,147 |
|
|
|
493 |
|
Net cash used in investing activities |
|
(281 |
) |
|
|
(171 |
) |
Cash flows from financing
activities: |
|
|
|
Repurchases of 2026 Notes |
|
— |
|
|
|
(11,248 |
) |
Dividend payments |
|
(3,248 |
) |
|
|
— |
|
Proceeds from stock options exercised |
|
1,990 |
|
|
|
31 |
|
Shares withheld in lieu of employee tax withholding |
|
(35 |
) |
|
|
— |
|
Withholdings for shares issued under the ESPP |
|
403 |
|
|
|
430 |
|
Repurchases of stock |
|
(4,299 |
) |
|
|
— |
|
Repayments of capitalized obligations |
|
(645 |
) |
|
|
(45 |
) |
Net cash used in financing activities |
|
(5,834 |
) |
|
|
(10,832 |
) |
Cash and cash equivalents and
restricted cash: |
|
|
|
Net decrease in cash, cash equivalents and restricted
cash |
|
(4,444 |
) |
|
|
(1,648 |
) |
Beginning of period |
|
61,549 |
|
|
|
43,913 |
|
End of period |
$ |
57,105 |
|
|
$ |
42,265 |
|
TOWNSQUARE MEDIA, INC.CONSOLIDATED
STATEMENTS OF CASH FLOWS (continued)(in
Thousands)(unaudited) |
|
Three Months Ended March
31, |
|
|
2024 |
|
|
2023 |
Supplemental
Disclosure of Cash Flow Information: |
|
|
|
Cash payments: |
|
|
|
Interest |
$ |
17,638 |
|
$ |
18,728 |
Income taxes |
|
12 |
|
|
4 |
|
|
|
|
Supplemental
Disclosure of Non-cash Activities: |
|
|
|
Dividends declared, but not paid during the period |
$ |
3,158 |
|
$ |
3,343 |
Property and equipment acquired in exchange for advertising(1) |
|
404 |
|
|
98 |
Accrued capital expenditures |
|
107 |
|
|
89 |
|
|
|
|
Supplemental
Disclosure of Cash Flow Information relating to
Leases: |
|
|
|
Cash paid for amounts included in the measurement of operating
lease liabilities, included in operating cash flows |
$ |
3,026 |
|
$ |
3,029 |
Right-of-use assets obtained in exchange for operating lease
obligations |
|
2,140 |
|
|
1,309 |
|
|
|
|
Reconciliation of cash, cash equivalents and restricted
cash |
|
|
|
Cash and cash equivalents |
$ |
56,600 |
|
$ |
41,768 |
Restricted cash |
|
505 |
|
|
497 |
|
$ |
57,105 |
|
$ |
42,265 |
(1) Represents total advertising services
provided by the Company in exchange for property and equipment
during each of the three months ended March 31, 2024 and 2023,
respectively.
TOWNSQUARE MEDIA, INC.CONSOLIDATED
STATEMENTS OF OPERATIONS BY SEGMENT(in
Thousands)(unaudited) |
|
Three Months Ended March
31, |
|
|
|
|
2024 |
|
|
|
2023 |
|
|
% Change |
Subscription Digital Marketing Solutions |
$ |
18,253 |
|
|
$ |
21,561 |
|
|
(15.3 |
) |
% |
Digital Advertising |
|
34,156 |
|
|
|
33,707 |
|
|
1.3 |
|
% |
Broadcast Advertising |
|
45,455 |
|
|
|
45,923 |
|
|
(1.0 |
) |
% |
Other |
|
1,769 |
|
|
|
1,919 |
|
|
(7.8 |
) |
% |
Net
revenue |
|
99,633 |
|
|
|
103,110 |
|
|
(3.4 |
) |
% |
Subscription Digital Marketing
Solutions Expenses |
|
13,197 |
|
|
|
15,962 |
|
|
(17.3 |
) |
% |
Digital Advertising
expenses |
|
27,100 |
|
|
|
23,613 |
|
|
14.8 |
|
% |
Broadcast Advertising
expenses |
|
35,270 |
|
|
|
37,365 |
|
|
(5.6 |
) |
% |
Other expenses |
|
1,328 |
|
|
|
1,384 |
|
|
(4.0 |
) |
% |
Direct operating expenses |
|
76,895 |
|
|
|
78,324 |
|
|
(1.8 |
) |
% |
Depreciation and amortization |
|
4,935 |
|
|
|
4,944 |
|
|
(0.2 |
) |
% |
Corporate expenses |
|
5,217 |
|
|
|
5,345 |
|
|
(2.4 |
) |
% |
Stock-based compensation |
|
2,870 |
|
|
|
1,772 |
|
|
62.0 |
|
% |
Transaction and business realignment costs |
|
1,444 |
|
|
|
292 |
|
|
394.5 |
|
% |
Impairment of intangible and long-lived assets |
|
1,618 |
|
|
|
8,487 |
|
|
(80.9 |
) |
% |
Net loss (gain) on sale and retirement of assets |
|
14 |
|
|
|
(292 |
) |
|
(104.8 |
) |
% |
Total operating costs and expenses |
|
92,993 |
|
|
|
98,872 |
|
|
(5.9 |
) |
% |
Operating income |
|
6,640 |
|
|
|
4,238 |
|
|
56.7 |
|
% |
Other expense (income): |
|
|
|
|
|
|
|
Interest expense, net |
|
9,031 |
|
|
|
9,558 |
|
|
(5.5 |
) |
% |
Gain on repurchases of debt |
|
— |
|
|
|
(775 |
) |
|
(100.0 |
) |
% |
Other income, net |
|
(4,151 |
) |
|
|
(1,026 |
) |
|
304.6 |
|
% |
Income (loss) from operations before tax |
|
1,760 |
|
|
|
(3,519 |
) |
|
** |
Income tax provision
(benefit) |
|
207 |
|
|
|
(1,578 |
) |
|
** |
Net income
(loss) |
$ |
1,553 |
|
|
$ |
(1,941 |
) |
|
** |
** not meaningful
The following table presents Net revenue and
Adjusted Operating Income by segment, for the three months ended
March 31, 2024, and 2023, respectively (in thousands):
|
Three Months Ended March
31, |
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
|
2024 |
|
|
2023 |
|
% Change |
Subscription Digital Marketing Solutions |
$ |
18,253 |
|
$ |
21,561 |
|
(15.3 |
) |
% |
Digital Advertising |
|
34,156 |
|
|
33,707 |
|
1.3 |
|
% |
Digital |
|
52,409 |
|
|
55,268 |
|
(5.2 |
) |
% |
Broadcast Advertising |
|
45,455 |
|
|
45,923 |
|
(1.0 |
) |
% |
Other |
|
1,769 |
|
|
1,919 |
|
(7.8 |
) |
% |
Net
revenue |
$ |
99,633 |
|
$ |
103,110 |
|
(3.4 |
) |
% |
Subscription Digital Marketing
Solutions |
$ |
5,056 |
|
$ |
5,599 |
|
(9.7 |
) |
% |
Digital Advertising |
|
7,056 |
|
|
10,094 |
|
(30.1 |
) |
% |
Digital |
|
12,112 |
|
|
15,693 |
|
(22.8 |
) |
% |
Broadcast Advertising |
|
10,185 |
|
|
8,558 |
|
19.0 |
|
% |
Other |
|
441 |
|
|
535 |
|
(17.6 |
) |
% |
Adjusted Operating
Income |
$ |
22,738 |
|
$ |
24,786 |
|
(8.3 |
) |
% |
The following table reconciles Net revenue to
Net revenue, excluding political revenue on a GAAP basis by segment
for the three months ended March 31, 2024, and 2023, respectively
(in thousands):
|
Three Months Ended March
31, |
|
|
|
(Unaudited) |
|
|
|
|
2024 |
|
|
2023 |
|
% Change |
Subscription Digital Marketing Solutions |
$ |
18,253 |
|
$ |
21,561 |
|
(15.3 |
) |
% |
Digital Advertising |
|
34,156 |
|
|
33,707 |
|
1.3 |
|
% |
Digital |
|
52,409 |
|
|
55,268 |
|
(5.2 |
) |
% |
Broadcast Advertising |
|
45,455 |
|
|
45,923 |
|
(1.0 |
) |
% |
Other |
|
1,769 |
|
|
1,919 |
|
(7.8 |
) |
% |
Net
revenue |
$ |
99,633 |
|
$ |
103,110 |
|
(3.4 |
) |
% |
Subscription Digital Marketing
Solutions political revenue |
|
— |
|
|
— |
|
— |
|
|
Digital Advertising political
revenue |
|
72 |
|
|
15 |
|
380.0 |
|
% |
Broadcast Advertising
political revenue |
|
988 |
|
|
198 |
|
399.0 |
|
% |
Other political revenue |
|
— |
|
|
— |
|
— |
|
|
Political
revenue |
$ |
1,060 |
|
$ |
213 |
|
397.7 |
|
% |
Subscription Digital Marketing
Solutions net revenue (ex. political) |
$ |
18,253 |
|
$ |
21,561 |
|
(15.3 |
) |
% |
Digital Advertising net
revenue (ex. political) |
|
34,084 |
|
|
33,692 |
|
1.2 |
|
% |
Digital net revenue (ex. political) |
|
52,337 |
|
|
55,253 |
|
(5.3 |
) |
% |
Broadcast Advertising
political net revenue (ex. political) |
|
44,467 |
|
|
45,725 |
|
(2.8 |
) |
% |
Other net revenue (ex.
political) |
|
1,769 |
|
|
1,919 |
|
(7.8 |
) |
% |
Net revenue (ex.
political) |
$ |
98,573 |
|
$ |
102,897 |
|
(4.2 |
) |
% |
The following table reconciles on a GAAP basis
net income (loss), the most directly comparable financial measure
calculated and presented in accordance with GAAP, to Adjusted Net
Income for the three months ended March 31, 2024, and 2023,
respectively (in thousands, except per share data):
|
Three Months Ended March
31, |
|
(Unaudited) |
|
|
2024 |
|
|
|
2023 |
|
Net income (loss) |
$ |
1,553 |
|
|
$ |
(1,941 |
) |
Income tax provision
(benefit) |
|
207 |
|
|
|
(1,578 |
) |
Income (loss) from
operations before taxes |
|
1,760 |
|
|
|
(3,519 |
) |
Transaction and business realignment costs |
|
1,444 |
|
|
|
292 |
|
Impairment of intangible and long-lived assets |
|
1,618 |
|
|
|
8,487 |
|
Net loss (gain) on sale and retirement of assets |
|
14 |
|
|
|
(292 |
) |
Gain on repurchases of debt |
|
— |
|
|
|
(775 |
) |
Gain on sale of digital assets |
|
— |
|
|
|
(839 |
) |
Gain on sale of investment |
|
(4,009 |
) |
|
|
— |
|
Change in fair value of investment |
|
233 |
|
|
|
134 |
|
Gain on insurance recoveries |
|
— |
|
|
|
(372 |
) |
Net income attributable to non-controlling interest, net of income
taxes |
|
(417 |
) |
|
|
(480 |
) |
Adjusted net income
before income taxes |
|
643 |
|
|
|
2,636 |
|
Income tax provision (1) |
|
163 |
|
|
|
669 |
|
Adjusted Net
Income |
$ |
480 |
|
|
$ |
1,967 |
|
|
|
|
|
Adjusted Net Income Per
Share: |
|
|
|
Basic |
$ |
0.03 |
|
|
$ |
0.11 |
|
Diluted |
$ |
0.03 |
|
|
$ |
0.11 |
|
|
|
|
|
Weighted average shares
outstanding: |
|
|
|
Basic |
|
16,562 |
|
|
|
17,204 |
|
Diluted |
|
18,762 |
|
|
|
17,483 |
|
(1) Income tax provision for the three months
ended March 31, 2024 and 2023 was calculated using the Company's
statutory effective tax rate.
The following table reconciles on a GAAP basis
net income (loss), the most directly comparable financial measure
calculated and presented in accordance with GAAP, to Adjusted
EBITDA, Adjusted EBITDA (Excluding Political), and Adjusted EBITDA
Less Interest, Capex and Taxes for the three months ended March 31,
2024, and 2023, respectively (dollars in thousands):
|
Three Months Ended March
31, |
|
(Unaudited) |
|
|
2024 |
|
|
|
2023 |
|
Net income
(loss) |
$ |
1,553 |
|
|
$ |
(1,941 |
) |
Income tax provision (benefit) |
|
207 |
|
|
|
(1,578 |
) |
Interest expense, net |
|
9,031 |
|
|
|
9,558 |
|
Gain on repurchases of debt |
|
— |
|
|
|
(775 |
) |
Depreciation and amortization |
|
4,935 |
|
|
|
4,944 |
|
Stock-based compensation |
|
2,870 |
|
|
|
1,772 |
|
Transaction and business realignment costs |
|
1,444 |
|
|
|
292 |
|
Impairment of intangible and long-lived assets |
|
1,618 |
|
|
|
8,487 |
|
Other (a) |
|
(4,137 |
) |
|
|
(1,318 |
) |
Adjusted
EBITDA |
$ |
17,521 |
|
|
$ |
19,441 |
|
Political Adjusted EBITDA |
|
(901 |
) |
|
|
(181 |
) |
Adjusted EBITDA
(Excluding Political) |
$ |
16,620 |
|
|
$ |
19,260 |
|
Political Adjusted EBITDA |
|
901 |
|
|
|
181 |
|
Net cash paid for interest |
|
(17,638 |
) |
|
|
(18,728 |
) |
Capital expenditures |
|
(4,428 |
) |
|
|
(3,639 |
) |
Cash paid for taxes |
|
(12 |
) |
|
|
(4 |
) |
Adjusted EBITDA Less
Interest, Capex and Taxes |
$ |
(4,557 |
) |
|
$ |
(2,930 |
) |
(a) Other includes net loss on sale and retirement of assets and
other expense (income), net.
The following table reconciles net income
(loss), 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 March 31, 2024 (dollars
in thousands):
|
Three Months Ended |
|
Twelve Months Ended |
|
(Unaudited) |
|
June 30, 2023 |
|
September 30, 2023 |
|
December 31, 2023 |
|
March 31, 2024 |
|
March 31, 2024 |
Net income (loss) |
$ |
(2,700 |
) |
|
$ |
(36,503 |
) |
|
$ |
(1,878 |
) |
|
$ |
1,553 |
|
|
$ |
(39,528 |
) |
Income tax benefit |
|
(6,520 |
) |
|
|
17,478 |
|
|
|
(15,522 |
) |
|
|
207 |
|
|
|
(4,357 |
) |
Interest expense, net |
|
9,314 |
|
|
|
9,343 |
|
|
|
9,034 |
|
|
|
9,031 |
|
|
|
36,722 |
|
Gain on repurchases of debt |
|
(44 |
) |
|
|
(430 |
) |
|
|
— |
|
|
|
— |
|
|
|
(474 |
) |
Depreciation and amortization |
|
4,835 |
|
|
|
4,717 |
|
|
|
4,704 |
|
|
|
4,935 |
|
|
|
19,191 |
|
Stock-based compensation |
|
2,106 |
|
|
|
2,350 |
|
|
|
1,805 |
|
|
|
2,870 |
|
|
|
9,131 |
|
Transaction and business realignment costs |
|
311 |
|
|
|
161 |
|
|
|
405 |
|
|
|
1,444 |
|
|
|
2,321 |
|
Impairment of intangible assets, investments, goodwill and
long-lived assets |
|
26,240 |
|
|
|
30,970 |
|
|
|
24,881 |
|
|
|
1,618 |
|
|
|
83,709 |
|
Other (a) |
|
(4,927 |
) |
|
|
(909 |
) |
|
|
1,349 |
|
|
|
(4,137 |
) |
|
|
(8,624 |
) |
Adjusted
EBITDA |
$ |
28,615 |
|
|
$ |
27,177 |
|
|
$ |
24,778 |
|
|
$ |
17,521 |
|
|
$ |
98,091 |
|
(a) Other includes net (loss) gain on sale and retirement of
assets and other (income) expense, net.
The following tables reconcile Operating income
(loss), the most directly comparable financial measure calculated
and presented in accordance with GAAP, to Adjusted Operating Income
by segment for the three months ended March 31, 2024, and 2023 (in
thousands):
|
Three Months Ended March 31,
2024 |
|
(Unaudited) |
|
Subscription Digital Marketing Solutions |
|
Digital Advertising |
|
Broadcast Advertising |
|
Other |
|
Corporate and Other Reconciling Items |
|
Total |
Operating income (loss) |
$ |
4,288 |
|
$ |
6,727 |
|
$ |
5,482 |
|
$ |
398 |
|
$ |
(10,255 |
) |
|
$ |
6,640 |
Depreciation and amortization |
|
614 |
|
|
181 |
|
|
2,864 |
|
|
33 |
|
|
1,243 |
|
|
|
4,935 |
Corporate expenses |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
5,217 |
|
|
|
5,217 |
Stock-based compensation |
|
154 |
|
|
148 |
|
|
189 |
|
|
4 |
|
|
2,375 |
|
|
|
2,870 |
Transaction and business realignment costs |
|
— |
|
|
— |
|
|
18 |
|
|
6 |
|
|
1,420 |
|
|
|
1,444 |
Impairment of long-lived assets |
|
— |
|
|
— |
|
|
1,618 |
|
|
— |
|
|
— |
|
|
|
1,618 |
Net loss on sale and retirement of assets |
|
— |
|
|
— |
|
|
14 |
|
|
— |
|
|
— |
|
|
|
14 |
Adjusted Operating
Income |
$ |
5,056 |
|
$ |
7,056 |
|
$ |
10,185 |
|
$ |
441 |
|
$ |
— |
|
|
$ |
22,738 |
|
Three Months Ended March 31,
2023 |
|
(Unaudited) |
|
Subscription Digital Marketing Solutions |
|
Digital Advertising |
|
Broadcast Advertising |
|
Other |
|
Corporate and Other Reconciling Items |
|
Total |
Operating income (loss) |
$ |
5,143 |
|
$ |
9,885 |
|
$ |
(3,594 |
) |
|
$ |
486 |
|
$ |
(7,682 |
) |
|
$ |
4,238 |
|
Depreciation and amortization |
|
328 |
|
|
164 |
|
|
3,600 |
|
|
|
36 |
|
|
816 |
|
|
|
4,944 |
|
Corporate expenses |
|
— |
|
|
— |
|
|
— |
|
|
|
— |
|
|
5,345 |
|
|
|
5,345 |
|
Stock-based compensation |
|
128 |
|
|
45 |
|
|
164 |
|
|
|
2 |
|
|
1,433 |
|
|
|
1,772 |
|
Transaction and business realignment costs |
|
— |
|
|
— |
|
|
193 |
|
|
|
11 |
|
|
88 |
|
|
|
292 |
|
Impairment of intangible and long-lived assets |
|
— |
|
|
— |
|
|
8,487 |
|
|
|
— |
|
|
— |
|
|
|
8,487 |
|
Net gain on sale and retirement of assets |
|
— |
|
|
— |
|
|
(292 |
) |
|
|
— |
|
|
— |
|
|
|
(292 |
) |
Adjusted Operating
Income |
$ |
5,599 |
|
$ |
10,094 |
|
$ |
8,558 |
|
|
$ |
535 |
|
$ |
— |
|
|
$ |
24,786 |
|
Townsquare Media (NYSE:TSQ)
Historical Stock Chart
From Apr 2024 to May 2024
Townsquare Media (NYSE:TSQ)
Historical Stock Chart
From May 2023 to May 2024