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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Entercom Communications Corp | NYSE:ETM | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 5.03 | 0 | 01:00:00 |
Entercom Communications Corp. (NYSE: ETM) today reported financial results for the quarter ended September 30, 2020.
Third Quarter Summary
CEO Comment
David J. Field, President and Chief Executive Officer, stated: “I am pleased to report that Entercom continued to make significant organizational improvements in the third quarter in the face of the deeply challenging pandemic. Third quarter net revenues were up 53% from the second quarter while our continuing work on enhancing our business model yielded an 18% reduction in operating expenses versus the prior year enabling us to rebound to positive Adjusted EBITDA of $31 million. We expect further improvement in both revenues and Adjusted EBITDA in the fourth quarter.
We continue to suffer from the deep impact of the pandemic which has caused many of our advertisers in businesses such as concerts and live events, tourism, gyms, nightclubs, museums, movies, theme parks, public transportation, airlines, restaurants, and others to temporarily cease or significantly curtail their operations and advertising. We look forward to welcoming them back once we emerge from the pandemic.
We continue to build and transform Entercom into a leading multi-platform audio content and entertainment company with scaled audience reach, robust data, analytics and attribution capabilities, and a leadership position in virtually every segment of the dynamic and growing audio market, including broadcasting, podcasting, digital, events, network, music, sports and news. Entercom is strategically well positioned for future performance as our enhanced capabilities enable us to expand our customer relationships and accelerate growth.
As an illustration of the appeal of our evolving capabilities, we recently announced a landmark six-year partnership with FanDuel which we believe is the largest advertising deal in the history of the radio business. This partnership is a powerful testament to the importance of our unrivaled audio sports business which includes most of the country’s leading sports talk stations and personalities with their deep fan engagement.”
Recent Company Developments
Earnings Conference Call and Company Information
Entercom will hold a conference call and simultaneous webcast regarding the quarterly earnings release on Friday, November 6, 2020, at 10:00 AM Eastern Time. The public may access the conference call by dialing Toll Free: (888) 889-0278 and Toll: (773) 799-3659, passcode: Entercom (domestic and international callers). Participants may also listen to a live webcast of the call by visiting the “Investor Relations” section of Entercom’s website at www.entercom.com. A replay of the conference call will be available for one week by dialing (800) 841-8615. A webcast replay of the conference call will be available beginning six hours after the call on the Company’s website for a period of two weeks. Additional information is available on the Company’s website at www.entercom.com.
About Entercom Communications Corp.
Entercom Communications Corp. (NYSE: ETM) is a leading audio and entertainment company engaging over 170 million consumers each month through its iconic broadcast brands, expansive digital platform, premium podcast network and live events and experiences. With presence in every major U.S. market, and accessible on every device, Entercom delivers the industry’s most compelling live and on-demand content and experiences from voices and influencers its communities trust and love. The company’s robust portfolio of assets and integrated solutions offer advertisers today’s most engaged audiences through targeted reach, brand amplification and local activation—all at national scale. Entercom is the unrivaled leader in local radio sports and news and the #1 creator of live, original local audio content in the U.S. Learn more at www.entercom.com, Facebook and Twitter (@Entercom).
Certain Definitions
All references to per share data, unless stated otherwise, are presented as per diluted share. All references to shares outstanding, unless stated otherwise, are presented to exclude unvested restricted stock units. All references to net debt are outstanding debt net of cash on hand.
Station Expenses consist of station operating expenses excluding non-cash compensation expense.
Corporate Expenses consist of corporate general and administrative expenses excluding non-cash compensation expense.
Station Operating Income consists of operating income (loss) before: depreciation and amortization; time brokerage agreement fees (income); corporate general and administrative expenses; non-cash compensation expense (which is otherwise included in station operating expenses); impairment loss; merger and acquisition costs, restructuring and integration costs, other expenses related to the refinancing; and gain or loss on sale or disposition of assets.
Adjusted EBITDA consists of net income (loss) available to common shareholders, adjusted to exclude: income taxes (benefit); income from discontinued operations, net of income taxes or benefit; total other income or expense; net interest expense; depreciation and amortization; time brokerage agreement fees (income); non-cash compensation expense (which is otherwise included in station operating expenses and corporate G&A expenses); other expenses related to the refinancing; impairment loss, merger and acquisition costs, restructuring and integration costs, preferred stock dividends; COVID-19 related expenses, non-recurring expenses/recoveries otherwise included in corporate or station expenses, loss on early extinguishment of debt, and gain or loss on sale or disposition of assets.
Adjusted Free Cash Flow consists of operating income (loss): (i) plus depreciation and amortization; net (gain) loss on sale or disposal of assets; non-cash compensation expense (which is otherwise included in station operating expenses and corporate general and administrative expenses); impairment loss; merger and acquisition costs; restructuring and integration costs, COVID-19 related expenses, other income and non-recurring expenses/recoveries otherwise included in corporate or station expenses; income from discontinued operations (excluding income taxes or tax benefit); and (ii) less net interest expense (excluding amortization of deferred financing costs or debt premium), Adjusted Income Taxes Paid, and Net Capital Expenditures.
Net Capital Expenditures consists of capital expenditures, including amortizable intangibles, adjusted to subtract reimbursed tenant improvement allowances.
Adjusted Income Taxes Paid consist of income tax paid, adjusted to exclude taxes paid related to the gain/loss on sale or exchange of radio station assets; and taxes paid related to the gain/loss on the sale of redundant property.
Adjusted Net Income (Loss) consists of net income (loss) available to common shareholders adjusted to exclude: (i) income taxes (benefit) as reported, including income taxes otherwise included in income from discontinued operations; (ii) gain/loss on sale of assets, derivative instruments and investments; (iii) non-cash compensation expense; (iv) impairment loss; (v) merger and acquisition costs, restructuring and integration costs, COVID-19 related expenses, and non-recurring expenses/recoveries otherwise included in corporate or station expenses; (vi) other expenses related to refinancing; and (vii) gain/loss on early extinguishment of debt. For purposes of comparability, income taxes are reflected at the expected statutory federal and state income tax rate of 30% without discrete items of tax.
Adjusted Net Income (Loss) Per Share - Diluted includes any dilutive equivalent shares when not anti-dilutive. Convertible Preferred Stock is treated as if it never converted for the purposes of Adjusted Net Income (Loss) Per Share - Diluted.
Non-GAAP Financial Measures
It is important to note that station operating income, station expense, corporate expense, Adjusted EBITDA, Adjusted Net Income, Adjusted Net Income (Loss) Per Share – Diluted, Adjusted Free Cash Flow, Net Capital Expenditures and Adjusted Income Taxes Paid are not measures of performance or liquidity calculated in accordance with generally accepted accounting principles (“GAAP”). Management believes that these measures are useful as a way to evaluate the Company and the means for Management to evaluate our radio stations’ performance and operations. Management believes that these measures are useful to an investor in evaluating our performance because they are widely used in the broadcast industry as a measure of a radio company’s operating performance.
Certain adjusted non-GAAP financial measures are presented in this release (e.g., Adjusted Net Income (Loss) and Adjusted Net Income (Loss) Per Share - Diluted). The adjustments exclude gain/loss on sale of assets, derivative instruments, and investments; non-cash compensation expense, other income, impairment loss, merger and acquisition costs, other expenses related to the refinancing, and gain/loss on early extinguishment of debt and non-recurring expenses recognized for restructuring charges or similar costs, including transition and integration costs. For purposes of comparability, income taxes are reflected at the expected federal and state income tax rate of 30%, without adjustment for discrete tax adjustments.
Management believes these adjusted non-GAAP measures provide useful information to Management and investors by excluding certain income, expenses and gains and losses that may not be indicative of the Company’s core operating and financial results. Similarly, Management believes these adjusted measures are a useful performance measure because certain items included in the calculation of net income (loss) may either mask or exaggerate trends in the Company’s ongoing operating performance. Further, the reconciliations corresponding to these adjusted measures, by identifying the individual adjustments, provide a useful mechanism for investors to consider these adjusted measures with some or all of the identified adjustments.
Management uses these non-GAAP financial measures on an ongoing basis to help track and assess the Company's financial performance. You, however, should not consider non-GAAP measures in isolation or as substitutes for net income (loss), operating income, or any other measure for determining our operating performance that is calculated in accordance with generally accepted accounting principles. These non-GAAP measures are not necessarily comparable to similarly titled measures employed by other companies. The accompanying financial tables provide reconciliations to the nearest GAAP measure of all non-GAAP measures provided in this release.
Note Regarding Forward-Looking Statements
The information in this news release is being widely disseminated in accordance with the Securities and Exchange Commission's Regulation FD.
This news announcement contains certain forward-looking statements that are based upon current expectations and certain unaudited information that is presented for illustrative purposes only and involves certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Additional information and key risks are described in the Company’s filings on Forms S-4, 8-K, 10-Q and 10-K with the Securities and Exchange Commission. Readers should note that these statements might be impacted by several factors including changes in the economic and regulatory climate and the business of radio broadcasting, in general. The unaudited pro forma information and same station operating data reflect adjustments and are presented for comparative purposes only and do not purport to be indicative of what has occurred or indicative of future operating results or financial position. Accordingly, the Company’s actual performance may differ materially from those stated or implied herein. The Company assumes no obligation to publicly update or revise any unaudited pro forma or forward-looking statements.
ENTERCOM COMMUNICATIONS CORP.
FINANCIAL DATA
(amounts in thousands, except per share data)
(unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2020
2019
2020
2019
STATEMENTS OF OPERATIONS
Net Revenues
$
268,505
$
386,141
$
741,403
$
1,075,811
Station Expenses
228,147
272,005
666,643
797,502
Station Expense - Non-Cash Compensation
524
1,107
1,552
3,765
Corporate Expenses
13,105
17,178
37,423
51,141
Corporate Expenses - Non-Cash Compensation
1,421
2,234
4,616
6,521
Depreciation And Amortization
12,547
11,183
37,665
33,252
Time Brokerage Agreement Expense (Income)
-
13
-
106
Merger And Acquisition Costs
-
434
61
476
Impairment Loss
11,814
-
17,021
-
Restructuring Charges
1,206
1,577
10,310
5,953
Integration Costs
-
689
490
3,280
Other Expenses Related To Refinancing
-
-
-
1,864
Net (Gain) Loss On Sale Or Disposition of Assets
-
231
(228)
(2,683)
Total Operating Expenses
268,764
306,651
775,553
901,177
Operating Income (Loss)
(259)
79,490
(34,150)
174,634
Net Interest Expense
20,846
25,256
66,109
75,420
Loss on Early Extinguishment of Debt
-
-
-
1,781
Income (Loss) Before Income Taxes
(21,105)
54,234
(100,259)
97,433
Income Taxes (Benefit)
(4,227)
16,026
(20,432)
30,110
Net Income (Loss)
$
(16,878)
$
38,208
$
(79,827)
$
67,323
Net Income (Loss) Per Share - Basic
$
(0.13)
$
0.28
$
(0.59)
$
0.49
Net Income (Loss) Per Share - Diluted
$
(0.13)
$
0.28
$
(0.59)
$
0.49
Dividends Declared And Paid Per Common Share
$
0.00
$
0.02
$
0.02
$
0.20
Weighted Common Shares Outstanding - Basic
134,735
136,449
134,753
137,944
Weighted Common Shares Outstanding - Diluted
134,735
136,453
134,753
138,295
SUPPLEMENTAL BREAKDOWN OF REVENUE BY TYPE
Spot (local and national)
$
183,011
$
288,927
$
488,891
$
805,161
Digital (including podcasting)
47,337
33,473
131,188
98,430
Network
18,908
23,035
56,889
56,260
Sponsorships and Events
8,776
22,470
32,871
61,684
Other
10,473
18,236
31,564
54,276
$
268,505
$
386,141
$
741,403
$
1,075,811
Political
$
4,964
$
1,724
$
13,394
$
4,692
SUPPLEMENTAL BREAKDOWN OF REVENUE BY FORMAT
Music
$
133,555
$
227,445
$
395,867
$
641,604
Sports
59,885
82,742
132,072
210,034
News/Talk
47,100
60,968
136,964
177,140
Non-format specific
27,965
14,986
76,499
47,033
$
268,505
$
386,141
$
741,403
$
1,075,811
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Net Capital Expenditures
$
5,812
$
20,658
$
21,060
$
58,067
Adjusted Income Taxes Paid
$
2,660
$
-
$
3,957
$
8,461
Cash Dividends On Common Stock Declared And Paid
$
-
$
2,677
$
2,692
$
27,594
SELECTED BALANCE SHEET DATA
September 30,
December 31,
2020
2019
Cash and Cash Equivalents
$
32,369
$
20,393
Senior Debt - Term B-1 Loan (Includes Current Portion)
$
755,378
$
770,000
Senior Debt - Revolver (Includes Current Portion)
$
77,727
$
117,000
Senior Secured Notes
$
425,000
$
425,000
Senior Notes
$
400,000
$
400,000
Total Shareholders' Equity
$
803,687
$
881,443
OTHER FINANCIAL DATA
Three Months Ended
Nine Months Ended
September 30,
September 30,
2020
2019
2020
2019
Reconciliation Of GAAP Operating Income To Station
Operating Income
Operating Income (Loss)
$
(259)
$
79,490
$
(34,150)
$
174,634
Corporate Expenses
13,105
17,178
37,423
51,141
Corporate Expenses - Non-Cash Compensation
1,421
2,234
4,616
6,521
Station Expenses - Non-Cash Compensation
524
1,107
1,552
3,765
Depreciation And Amortization
12,547
11,183
37,665
33,252
Merger And Acquisition Costs
-
434
61
476
Restructuring Charges
1,206
1,577
10,310
5,953
Impairment Loss
11,814
-
17,021
-
Integration Costs
-
689
490
3,280
Other Expenses Related To Refinancing
-
-
-
1,864
Net Time Brokerage Agreement Expense
-
13
-
106
Net Gain (Loss) On Sale Or Disposition of Assets
-
231
(228)
(2,683)
Station Operating Income
$
40,358
$
114,136
$
74,760
$
278,309
Reconciliation Of GAAP Net Income (Loss) To Adjusted EBITDA
Net Income (Loss)
$
(16,878)
$
38,208
$
(79,827)
$
67,323
Income Taxes (Benefit)
(4,227)
16,026
(20,432)
30,110
Net Interest Expense
20,846
25,256
66,109
75,420
Corporate Expenses - Non-Cash Compensation
1,421
2,234
4,616
6,521
Station Expenses - Non-Cash Compensation
524
1,107
1,552
3,765
Depreciation And Amortization
12,547
11,183
37,665
33,252
Time Brokerage Agreement Expense (Income)
-
13
-
106
Merger And Acquisition Costs
-
434
61
476
Restructuring Charges
1,206
1,577
10,310
5,953
Integration Costs
-
689
490
3,280
COVID-19 Related Expenses
3,187
-
11,598
-
Non-Recurring Expenses/(Recoveries) Otherwise Included in Corporate Expenses
693
1,000
(3,307)
1,000
Impairment Loss
11,814
-
17,021
-
Other Expenses Related To Refinancing
-
-
-
1,864
Loss On Early Extinguishment Of Debt
-
-
-
1,781
Net Gain (Loss) On Sale Or Disposition of Assets
-
231
(228)
(2,683)
Adjusted EBITDA
$
31,133
$
97,958
$
45,628
$
228,168
Reconciliation of GAAP Net Income (Loss) To Adjusted Free Cash Flow
Net Income (Loss)
$
(16,878)
$
38,208
$
(79,827)
$
67,323
Depreciation And Amortization
12,547
11,183
37,665
33,252
Deferred Financing Costs Included In Interest Expense
999
755
2,942
2,227
Amortization Debt Premium Included In Interest Expense
(849)
(678)
(2,547)
(2,248)
Non-Cash Compensation Expense
1,945
3,341
6,168
10,286
Merger And Acquisition Costs
-
434
61
476
Integration Costs
-
689
490
3,280
Restructuring Charges
1,206
1,577
10,310
5,953
COVID-19 Related Expenses
3,187
-
11,598
-
Non-Recurring Expenses (Recoveries) Otherwise Included in Corporate Expenses
693
1,000
(3,307)
1,000
Impairment Loss
11,814
-
17,021
-
Net (Gain) Loss On Sale Or Disposition of Assets
-
231
(228)
(2,683)
Other Expenses Related To Refinancing
-
-
-
1,864
Loss On Early Extinguishment Of Debt
-
-
-
1,781
Income Taxes (Benefit)
(4,227)
16,026
(20,432)
30,110
Net Capital Expenditures, Including Amortizable Intangibles
(5,812)
(20,658)
(21,060)
(58,067)
Adjusted Income Taxes Paid
(2,660)
-
(3,957)
(8,461)
Adjusted Free Cash Flow
$
1,965
$
52,108
$
(45,103)
$
86,093
Three Months Ended
Nine Months Ended
September 30,
September 30,
2020
2019
2020
2019
Reconciliation Of Capital Expenditures, Including Amortizable
Intangibles, To Net Capital Expenditures
Capital Expenditures, Including Amortizable Intangibles
$
(5,812)
$
(22,862)
$
(21,905)
$
(63,575)
Reimbursed Tenant Improvement Allowance
-
2,204
845
5,508
Net Capital Expenditures
$
(5,812)
$
(20,658)
$
(21,060)
$
(58,067)
Reconciliation Of Income Taxes Paid To
Adjusted Income Taxes Paid
Income Taxes Paid
$
(2,660)
$
(3,935)
$
(3,957)
$
(18,481)
Income Taxes Paid Related to Gain/Loss On Sale Or Exchange Of Radio Station Assets
-
-
-
894
Income Taxes Paid Related to Gain/Loss On Sale Of Redundant Properties
-
3,935
-
9,126
Adjusted Income Taxes Paid
$
(2,660)
$
-
$
(3,957)
$
(8,461)
Reconciliation of GAAP Net Income (Loss) To Adjusted Net Income (Loss)
Net Income (Loss)
$
(16,878)
$
38,208
$
(79,827)
$
67,323
Income Taxes (Benefit)
(4,227)
16,026
(20,432)
30,110
Merger And Acquisition Costs
-
434
61
476
COVID-19 Related Expenses
3,187
-
11,598
-
Non-Recurring Expenses (Recoveries) Otherwise Included in Corporate Expenses
693
1,000
(3,307)
1,000
Other Expenses Related To Refinancing
-
-
-
1,864
Impairment Loss
11,814
-
17,021
-
Integration Costs
-
689
490
3,280
Restructuring Charges
1,206
1,577
10,310
5,953
Loss On Early Extinguishment Of Debt
-
-
-
1,781
Net (Gain) Loss On Sale Or Disposition of Assets
-
231
(228)
(2,683)
Non-Cash Compensation Expense
1,945
3,341
6,168
10,286
Adjusted Net Income (Loss) Before Income Taxes
(2,260)
61,506
(58,146)
119,390
Income Taxes (Benefit)
(678)
18,452
(17,444)
35,817
Adjusted Net Income (Loss)
$
(1,582)
$
43,054
$
(40,702)
$
83,573
Weighted Average Diluted Shares Outstanding For Purposes
Of Computing Adjusted Net Income Per Share - Diluted
Weighted Common Shares Outstanding - Diluted As Reported
134,735
136,453
134,753
138,295
Adjusted Net Income (Loss) Per Share - Diluted
$
(0.01)
$
0.32
$
(0.30)
$
0.60
View source version on businesswire.com: https://www.businesswire.com/news/home/20201106005101/en/
Joseph Jaffoni, Jennifer Neuman, Norberto Aja JCIR (212) 835-8500 etm@jcir.com
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