0001058623-16-000089.txt : 20161108 0001058623-16-000089.hdr.sgml : 20161108 20161108160321 ACCESSION NUMBER: 0001058623-16-000089 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20161108 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20161108 DATE AS OF CHANGE: 20161108 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CUMULUS MEDIA INC CENTRAL INDEX KEY: 0001058623 STANDARD INDUSTRIAL CLASSIFICATION: RADIO BROADCASTING STATIONS [4832] IRS NUMBER: 364159663 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-24525 FILM NUMBER: 161981291 BUSINESS ADDRESS: STREET 1: 3280 PEACHTREE ROAD N.W. STREET 2: SUITE 2300 CITY: ATLANTA STATE: GA ZIP: 30305 BUSINESS PHONE: 4049490700 MAIL ADDRESS: STREET 1: 3280 PEACHTREE ROAD N.W. STREET 2: SUITE 2300 CITY: ATLANTA STATE: GA ZIP: 30305 8-K 1 cmls-201609308xk.htm 8-K Document


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
____________________________ 
FORM 8-K
 
____________________________ 
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): November 8, 2016
 
______________________________ 
CUMULUS MEDIA INC.
 
(Exact name of registrant as specified in its charter)
 
______________________________ 
 
 
 
 
 
 
Delaware
  
000-24525
  
36-4159663
(State or other jurisdiction
of incorporation)
  
(Commission
File Number)
  
(IRS employer
Identification No.)
 
 
3280 Peachtree Road, N.W., Suite 2300, Atlanta GA
  
30305
(Address of principal executive offices)
  
(Zip Code)
Registrant’s telephone number, including area code (404) 949-0700
n/a
 
(Former name or former address, if changed since last report)
  
 _________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))






Item 2.02 — Results of Operations and Financial Condition.
On November 8, 2016, Cumulus Media Inc. ("we") issued a press release announcing operating results for the three and nine months ended September 30, 2016. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
This information is furnished pursuant to Item 2.02 of Form 8-K and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, unless we specifically incorporate it by reference in a document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934.
Item 9.01 — Financial Statements and Exhibits.
(d)
Exhibits.
Number
  
Exhibit
 
 
99.1
  
Press release, dated November 8, 2016




SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
 
 
 
 
 
CUMULUS MEDIA INC.
 
 
 
 
 
 
 
By:
 
/s/ John Abbot
 
 
 
 
Name: John Abbot
 
 
 
 
Title: Executive Vice President, Treasurer and Chief Financial Officer
Date: November 8, 2016





Exhibit Index
 
 
 
 
Number
  
Exhibit
 
 
99.1
  
Press release, dated November 8, 2016
 



 EX-99.1 2 cmls09302016earningsrelease.htm EXHIBIT 99.1 Exhibit



image0a09.jpg

CUMULUS MEDIA INC.

Cumulus Reports Operating Results for Third Quarter 2016

ATLANTA, GA — November 8, 2016: Cumulus Media Inc. (NASDAQ: CMLS) (the “Company,” “we,” “us,” or “our”) today announced operating results for the three and nine months ended September 30, 2016.  

For the three months ended September 30, 2016, the Company reported net revenue of $286.1 million, down 1.1% from the three months ended September 30, 2015, net income of $46.3 million and Adjusted EBITDA of $43.9 million, down 37.9% from the quarter ended September 30, 2015. For the nine months ended September 30, 2016, the Company reported net revenue of $841.9 million, down 2.1% from the nine months ended September 30, 2015, net income of $33.0 million and Adjusted EBITDA of $149.0 million, down 24.0% from the nine months ended September 30, 2015.

Excluding the impact of $14.4 million of expenses incurred during the quarter ended September 30, 2016, to resolve previously disputed syndicated programming and network inventory expenses with CBS Radio Inc., Adjusted EBITDA declined 17.5% from the quarter ended September 30, 2015 and 16.7% from the nine months ended September 30, 2015.

Mary Berner, President and Chief Executive Officer of Cumulus Media Inc. said, “A year into our turnaround effort, we have made considerable progress against our operational priorities while leading the industry in ratings growth. Though our performance in the quarter was negatively impacted by headwinds which have challenged us all year, we see evidence that our work is paying off financially as we gained share this quarter for the first time in at least four years. As we seek to maintain the momentum of our initial strategies, we have now also launched a focused effort to improve sales execution as the next logical step in our turnaround plan.”

Operating Summary (in thousands, except percentages and per share data):

 
Three Months Ended September 30,
 
2016
 
2015
 
% Change
Net revenue
$
286,136

 
$
289,441

 
(1.1
)%
Net income (loss)
$
46,321

 
$
(542,179
)
 
**
Adjusted EBITDA (1)
$
43,884

 
$
70,620

 
(37.9
)%
Basic and diluted income (loss) per share
$
1.58

 
$
(18.57
)
 
 
 
Nine Months Ended September 30,
 
2016
 
2015
 
% Change
Net revenue
$
841,859

 
$
859,854

 
(2.1
)%
Net income (loss)
$
32,958

 
$
(541,895
)
 
**
Adjusted EBITDA (1)
$
148,998

 
$
196,098

 
(24.0
)%
Basic and diluted income (loss) per share
$
1.12

 
$
(18.58
)
 
 

** Calculation is not meaningful





 
 
September 30, 2016
 
December 31, 2015
 
% Change
Cash and cash equivalents
 
$
157,601

 
$
31,657

 
397.8
%
 
 
 
 
 
 
 
     Term loans
 
1,838,940

 
$
1,838,940

 
—
%
     7.75% Senior Notes
 
610,000

 
610,000

 
—
%
Total debt
 
$
2,448,940

 
$
2,448,940

 
—
%

 
Three Months Ended September 30,
 
2016
 
2015
 
% Change
Capital expenditures
$
5,242

 
$
957

 
447.8
%
 
Nine Months Ended September 30,
 
2016
 
2015
 
% Change
Capital expenditures
$
16,704

 
$
15,817

 
5.6
%

(1)
Adjusted EBITDA is not a financial measure calculated or presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). For additional information, see “Non-GAAP Financial Measure and Definition”.

Results for Three Months Ended September 30, 2016

Net Revenue
The Company operates in two reportable segments, the Radio Station Group and Westwood One. The Radio Station Group revenue is derived primarily from the sale of broadcasting time to local, regional and national advertisers. Westwood One revenue is generated primarily through network advertising.
Corporate and Other includes overall executive, administrative and support functions for each of the Company’s reportable segments, including information technology, human resources, legal, finance and administrative functions.

The following tables present our net revenue by segment (dollars in thousands).

 
 
Three Months Ended September 30, 2016
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net revenue
 
$
206,199

 
$
79,413

 
$
524

 
$
286,136

% of total revenue
 
72.1
%
 
27.8
 %
 
0.1
 %
 
100.0
 %
$ change from three months ended September 30, 2015
 
$
1,522

 
$
(4,658
)
 
$
(169
)
 
$
(3,305
)
% change from three months ended September 30, 2015
 
0.7
%
 
(5.5
)%
 
(24.4
)%
 
(1.1
)%

 
 
Three Months Ended September 30, 2015
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net revenue
 
$
204,677

 
$
84,071

 
$
693

 
$
289,441

% of total revenue
 
70.7
%
 
29.1
%
 
0.2
%
 
100.0
%





Net income (loss)

The following tables present our net income (loss) by segment (dollars in thousands).

 
 
Three Months Ended September 30, 2016
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net income (loss)
 
$
134,119

 
$
(10,874
)
 
$
(76,924
)
 
$
46,321

$ change from three months ended September 30, 2015
 
$
522,257

 
$
134,470

 
$
(68,227
)
 
$
588,500

% change from three months ended September 30, 2015
 
**

 
92.5
%
 
(784.5
)%
 
**


 
 
Three Months Ended September 30, 2015
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net loss
 
$
(388,138
)
 
$
(145,344
)
 
$
(8,697
)
 
$
(542,179
)

** Calculation is not meaningful

Adjusted EBITDA

The following tables present our Adjusted EBITDA by segment (dollars in thousands).

 
 
Three Months Ended September 30, 2016
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Adjusted EBITDA
 
$
56,237

 
$
(2,689
)
 
$
(9,664
)
 
$
43,884

$ change from three months ended September 30, 2015
 
$
(6,795
)
 
$
(18,809
)
 
$
(1,132
)
 
$
(26,736
)
% change from three months ended September 30, 2015
 
(10.8
)%
 
**

 
(13.3
)%
 
(37.9
)%

 
 
Three Months Ended September 30, 2015
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Adjusted EBITDA
 
$
63,032

 
$
16,120

 
$
(8,532
)
 
$
70,620


** Calculation is not meaningful


















Results for Nine Months Ended September 30, 2016

Net Revenue

The following tables present our net revenue by segment (dollars in thousands).
 
 
Nine Months Ended September 30, 2016
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net revenue
 
$
592,640

 
$
247,507

 
$
1,712

 
$
841,859

% of total revenue
 
70.4
%
 
29.4
 %
 
0.2
 %
 
100.0
 %
$ change from nine months ended September 30, 2015
 
$
2,797

 
$
(19,880
)
 
$
(912
)
 
$
(17,995
)
% change from nine months ended September 30, 2015
 
0.5
%
 
(7.4
)%
 
(34.8
)%
 
(2.1
)%

 
 
Nine Months Ended September 30, 2015
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net revenue
 
$
589,843

 
$
267,387

 
$
2,624

 
$
859,854

% of total revenue
 
68.6
%
 
31.1
%
 
0.3
%
 
100.0
%

Net income (loss)

The following tables present our net income (loss) by segment (dollars in thousands).

 
 
Nine Months Ended September 30, 2016
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net income (loss)
 
$
205,263

 
$
(12,872
)
 
$
(159,433
)
 
$
32,958

$ change from nine months ended September 30, 2015
 
$
514,301

 
$
126,113

 
$
(65,561
)
 
$
574,853

% change from nine months ended September 30, 2015
 
**

 
90.7
%
 
(69.8
)%
 
**


 
 
Nine Months Ended September 30, 2015
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net loss
 
$
(309,038
)
 
$
(138,985
)
 
$
(93,872
)
 
$
(541,895
)

** Calculation is not meaningful
















Adjusted EBITDA

The following tables present our Adjusted EBITDA by segment (dollars in thousands).

 
 
Nine Months Ended September 30, 2016
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Adjusted EBITDA
 
$
159,278

 
$
17,998

 
$
(28,278
)
 
$
148,998

$ change from nine months ended September 30, 2015
 
$
(20,203
)
 
$
(25,058
)
 
$
(1,839
)
 
$
(47,100
)
% change from nine months ended June 30, 2015
 
(11.3
)%
 
(58.2
)%
 
(7.0
)%
 
(24.0
)%

 
 
Nine Months Ended September 30, 2015
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Adjusted EBITDA
 
$
179,481

 
$
43,056

 
$
(26,439
)
 
$
196,098


The following table presents our net revenue by segment for each quarter during the year ended December 31, 2015 (dollars in thousands).
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
 
 
 
 
 
 
 
 
 
Net revenue Q1 2015
 
$
175,668

 
$
94,549

 
$
862

 
$
271,079

Net revenue Q2 2015
 
              209,498

 
88,767

 
1,069

 
299,334

Net revenue Q3 2015
 
              204,677

 
84,071

 
693

 
289,441

Net revenue Q4 2015
 
              206,540

 
              101,581

 
                      704

 
              308,825

Net revenue FY 2015
 
$
796,383

 
$
368,968

 
$
3,328

 
$
1,168,679


The following table presents our net income (loss) by segment for each quarter during the year ended December 31, 2015 (dollars in thousands).
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
 
 
 
 
 
 
 
 
 
Net income (loss) Q1 2015
 
$
26,533

 
$
(1,208
)
 
$
(37,340
)
 
$
(12,015
)
Net income (loss) Q2 2015
 
52,567

 
7,568

 
(47,836
)
 
12,299

Net loss Q3 2015
 
(388,139
)
 
(145,345
)
 
(8,695
)
 
(542,179
)
Net income (loss) Q4 2015
 
43,776

 
(2,195
)
 
(46,180
)
 
(4,599
)
Net (loss) income FY 2015
 
$
(265,263
)
 
$
(141,180
)
 
$
(140,051
)
 
$
(546,494
)














The following table presents our Adjusted EBITDA by segment for each quarter during the year ended December 31, 2015 (dollars in thousands).

 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
 
 
 
 
 
 
 
 
 
Adjusted EBITDA Q1 2015
 
$
45,416

 
$
8,424

 
$
(9,177
)
 
$
44,663

Adjusted EBITDA Q2 2015
 
71,033

 
18,512

 
(8,730
)
 
80,815

Adjusted EBITDA Q3 2015
 
63,032

 
16,120

 
(8,532
)
 
70,620

Adjusted EBITDA Q4 2015
 
62,192

 
9,902

 
(9,047
)
 
63,047

Adjusted EBITDA FY 2015
 
$
241,673

 
$
52,958

 
$
(35,486
)
 
$
259,145


As previously disclosed, on November 3, 2015, we received a notification from the Listing Qualifications Department of The NASDAQ Stock Market LLC (“NASDAQ”) indicating that we were not in compliance with NASDAQ Listing Rule 5450(a)(1) (the “Rule”) because the minimum bid price of our Class A common stock had closed below $1.00 per share for 30 consecutive business days.  
On October 27, 2016 we received notification from NASDAQ that we had regained compliance with the Rule in order for our Class A common stock to remain listed on the NASDAQ Capital Market.    

Earnings Call Information
Cumulus Media Inc. will host a teleconference today at 4:30 PM eastern time to discuss its third quarter 2016 operating results.

The conference call dial-in number for domestic callers is 877-830-7699. International callers should dial 574-990-0924 for conference call access. If prompted, the conference ID is 98715812. Please call five to ten minutes in advance to ensure that you are connected prior to the presentation.

Following completion of the call, a replay can be accessed until 11:30 PM eastern time, December 8, 2016. Domestic callers can access the replay by dialing 800-585-8367 or 855-859-2056, replay code 98715812. International callers should dial +44 (0)145255000 for conference replay access. An archive of the webcast will be available beginning 24 hours after the call for a period of 30 days.

A link to the live audio webcast of the conference call and the related earnings presentation will be available on the investor section of the Cumulus Media Inc. website (www.cumulus.com/investors).





Forward-Looking Statements
Certain 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 certain historical and our future operating, financial, and strategic performance. Any such forward-looking statements are not guarantees of future performance and may 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 relating to the need for additional funds to service our debt and to execute our business strategy, our ability to access borrowings under our revolving credit facility, our ability from time to time to renew one or more of our broadcast licenses, changes in interest rates, changes in the fair value of our investments, the timing of, and our ability to complete any acquisitions or dispositions pending from time to time, costs and synergies resulting from the integration of any completed acquisitions, our ability to effectively manage costs, our ability to generate and manage growth, the popularity of radio as a broadcasting and advertising medium, changing consumer tastes, the impact of general economic conditions in the United States or in specific markets in which we currently do business, industry conditions, including existing competition and future competitive technologies and cancellation, disruptions or postponements of advertising schedules in response to national or world events, our ability to generate revenues from new sources, including local commerce and technology-based initiatives, the impact of regulatory rules or proceedings that may affect our business from time to time, our ability to continue to meet the listing standards for our Class A common stock to continue to be listed for trading on the NASDAQ stock market, the write off of a material portion of the fair value of our FCC broadcast licenses and goodwill, and other risk factors described from time to time in our filings with the Securities and Exchange Commission, including our Form 10-K for the year ended December 31, 2015 (the “2015 Form 10-K”) and any subsequently filed Forms 10-Q. 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 Inc. assumes no responsibility to update any forward-looking statement as a result of new information, future events or otherwise.

About Cumulus Media
A leader in the radio broadcasting industry, Cumulus Media (NASDAQ:CMLS) combines high-quality local programming with iconic, nationally syndicated media, sports and entertainment brands to deliver premium content choices to the 245 million people reached each week through its approximately 450 owned-and-operated stations broadcasting in 90 US media markets (including eight of the top 10), more than 8,200 broadcast radio stations affiliated with its Westwood One network and numerous digital channels. Together, the Cumulus/Westwood One platforms make Cumulus Media one of the few media companies that can provide advertisers with national reach and local impact. Cumulus/Westwood One is the exclusive radio broadcast partner to some of the largest brands in sports, entertainment, news, and talk, including the NFL, the NCAA, the Masters, the Olympics, the GRAMMYs, the Academy of Country Music Awards, the American Music Awards, the Billboard Music Awards, Westwood One News, and more. Additionally, it is the nation's leading provider of country music and lifestyle content through its NASH brand, which serves country fans nationwide through radio programming, exclusive digital content, and live events. For more information, visit www.cumulus.com.

For further information, please contact:
Cumulus Media Inc.
Collin Jones
Investor Relations
collin@cumulus.com
404-260-6600




CUMULUS MEDIA INC.
Unaudited Condensed Consolidated Statements of Operations
(Dollars in thousands, except per share data)
 
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
 
2016
 
2015
 
2016
 
2015
Net revenue
 
$
286,136

 
$
289,441

 
$
841,859

 
$
859,854

Operating expenses:
 
 
 
 
 
 
 
 
Content costs
 
115,348

 
94,829

 
312,526

 
286,655

Selling, general & administrative expenses
 
117,387

 
115,562

 
352,474

 
350,417

Depreciation and amortization
 
21,957

 
25,547

 
68,023

 
76,582

LMA fees
 
2,481

 
2,515

 
10,351

 
7,585

Corporate expenses
 
9,675

 
8,186

 
28,388

 
27,004

Stock-based compensation expense
 
735

 
12,304

 
2,403

 
20,047

Acquisition-related and restructuring costs
 
(450
)
 
13,763

 
3,237

 
13,160

(Gain) loss on sale of assets or stations
 
(94,014
)
 
57

 
(97,155
)
 
792

Impairment of intangible assets and goodwill
 
—

 
565,584

 
1,816

 
565,584

Impairment charges - equity interest in Pulser Media Inc.
 
—

 
18,308

 
—

 
19,364

Total operating expenses
 
173,119

 
856,655

 
682,063

 
1,367,190

Operating income (loss)
 
113,017

 
(567,214
)
 
159,796

 
(507,336
)
Non-operating (expense) income:
 
 
 
 
 
 
 
 
Interest expense
 
(34,929
)
 
(35,691
)
 
(103,896
)
 
(106,087
)
Interest income
 
139

 
22

 
364

 
407

Other income (expense), net
 
882

 
(151
)
 
1,598

 
12,601

Total non-operating expense, net
 
(33,908
)
 
(35,820
)
 
(101,934
)
 
(93,079
)
Income (loss) before income taxes
 
79,109

 
(603,034
)
 
57,862

 
(600,415
)
Income tax (expense) benefit
 
(32,788
)
 
60,855

 
(24,904
)
 
58,520

Net income (loss)
 
$
46,321

 
$
(542,179
)
 
$
32,958

 
$
(541,895
)
Basic and diluted income (loss) per common share:
 
 
 
 
 
 
 
 
Basic: Income (loss) per share
 
$
1.58

 
$
(18.57
)
 
$
1.12

 
$
(18.58
)
Diluted: Income (loss) per share
 
$
1.58

 
$
(18.57
)
 
$
1.12

 
$
(18.58
)
Weighted average basic common shares outstanding
 
29,275,111

 
29,194,508

 
29,268,885

 
29,165,188

Weighted average diluted common shares outstanding
 
29,275,111

 
29,194,508

 
29,268,885

 
29,165,188


        






Non-GAAP Financial Measure and Definition
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. Adjusted EBITDA is the financial metric utilized by management to analyze the cash flow generated by our business. This measure isolates the amount of income generated by our core operations after the incurrence of corporate, general and administrative expenses. 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 our non-operating expenses including debt service and acquisitions. In addition, consolidated Adjusted EBITDA is a key metric for purposes of calculating and determining our compliance with certain covenants contained in our credit facility.
In deriving this measure, the Company excludes depreciation, amortization, and stock-based compensation expense, as these do not represent cash payments for activities directly related to our core operations. The Company excludes any gain or loss on the exchange or sale of any assets as it does not represent a cash transaction. The Company also excludes any gain or loss on the exchange or sale of any assets and any gain or loss on derivative instruments as they do not represent cash transactions nor are they associated with core operations. Expenses relating to acquisitions and restructuring costs are also excluded from the calculation of Adjusted EBITDA as they are not directly related to our core operations. The Company also excludes any costs associated with impairment of assets as they do not require a cash outlay.
The Company believes that Adjusted EBITDA, although not a measure that is calculated in accordance with GAAP, is commonly employed by the investment community as a measure for determining the market value of a media company. The Company has also observed that Adjusted EBITDA is routinely employed to evaluate and negotiate the potential purchase price for media companies and is a key metric for purposes of calculating and determining compliance with certain covenants in our credit facility. Given the relevance to our overall value, the Company believes that investors consider the metric to be extremely useful.
Adjusted EBITDA should not be considered in isolation or as a substitute for net income (loss), 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 may be defined or calculated differently by other companies, and comparability may be limited.





















The following tables reconcile net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA for the three and nine months ended September 30, 2016 and 2015 (dollars in thousands):
 
 
Three Months Ended September 30, 2016
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net income (loss)
 
$
134,119

 
$
(10,874
)
 
$
(76,924
)
 
$
46,321

Income tax expense
 
—

 
—

 
32,788

 
32,788

Non-operating (income) expense, including net interest expense
 
(2
)
 
59

 
33,851

 
33,908

LMA fees
 
2,481

 
—

 
—

 
2,481

Depreciation and amortization
 
13,653

 
7,782

 
522

 
21,957

Stock-based compensation expense
 
—

 
—

 
735

 
735

Gain on sale of assets or stations
 
(94,014
)
 
—

 
—

 
(94,014
)
Acquisition-related and restructuring costs
 
—

 
344

 
(794
)
 
(450
)
Franchise and state taxes
 
—

 
—

 
158

 
158

Adjusted EBITDA
 
$
56,237

 
$
(2,689
)
 
$
(9,664
)
 
$
43,884



 
 
Three Months Ended September 30, 2015
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net loss
 
$
(388,138
)
 
$
(145,344
)
 
$
(8,697
)
 
$
(542,179
)
Income tax benefit
 
—

 
—

 
(60,855
)
 
(60,855
)
Non-operating (income) expense, including net interest expense
 
(3
)
 
313

 
35,510

 
35,820

LMA fees
 
2,515

 
—

 
—

 
2,515

Depreciation and amortization
 
15,900

 
9,092

 
555

 
25,547

Stock-based compensation expense
 
—

 
—

 
12,304

 
12,304

(Gain) loss on sale of assets or stations
 
(50
)
 
—

 
107

 
57

Impairment of intangible assets
 
432,808

 
132,672

 
104

 
565,584

Impairment charges - equity interest in Pulser Media Inc.
 
—

 
18,308

 
—

 
18,308

Acquisition-related and restructuring costs
 
—

 
1,079

 
12,684

 
13,763

Franchise and state taxes
 
—

 
—

 
(244
)
 
(244
)
Adjusted EBITDA
 
$
63,032

 
$
16,120

 
$
(8,532
)
 
$
70,620





 
 
Nine Months Ended September 30, 2016
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net income (loss)
 
$
205,263

 
$
(12,872
)
 
$
(159,433
)
 
$
32,958

Income tax expense
 
—

 
—

 
24,904

 
24,904

Non-operating expense, including net interest expense
 
14

 
226

 
101,694

 
101,934

LMA fees
 
10,351

 
—

 
—

 
10,351

Depreciation and amortization
 
40,780

 
25,657

 
1,586

 
68,023

Stock-based compensation expense
 
—

 
—

 
2,403

 
2,403

Gain on sale of assets or stations
 
(97,130
)
 
—

 
(25
)
 
(97,155
)
Impairment of intangible assets
 
—

 
1,816

 
—

 
1,816

Acquisition-related and restructuring costs
 
—

 
3,171

 
66

 
3,237

Franchise and state taxes
 
—

 
—

 
527

 
527

Adjusted EBITDA
 
$
159,278

 
$
17,998

 
$
(28,278
)
 
$
148,998



 
 
Nine Months Ended September 30, 2015
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net loss
 
$
(309,038
)
 
$
(138,985
)
 
$
(93,872
)
 
$
(541,895
)
Income tax benefit
 
—

 
—

 
(58,520
)
 
(58,520
)
Non-operating (income) expense, including net interest expense
 
(5
)
 
955

 
92,129

 
93,079

LMA fees
 
7,585

 
—

 
—

 
7,585

Depreciation and amortization
 
47,448

 
27,562

 
1,572

 
76,582

Stock-based compensation expense
 
—

 
—

 
20,047

 
20,047

Loss on sale of assets or stations
 
685

 
—

 
107

 
792

Impairment of intangible assets
 
432,806

 
132,671

 
107

 
565,584

Impairment charges -- equity interest in Pulser Media Inc.
 
—

 
19,364

 
—

 
19,364

Acquisition-related and restructuring costs
 
—

 
1,489

 
11,671

 
13,160

Franchise and state taxes
 
—

 
—

 
320

 
320

Adjusted EBITDA
 
$
179,481

 
$
43,056

 
$
(26,439
)
 
$
196,098







The following tables reconcile net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA for the three months ended March 31, 2015, June 30, 2015 and December 31, 2015, respectively (dollars in thousands):

 
 
Three Months Ended March 31, 2015
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net income (loss)
 
$
26,533

 
$
(1,208
)
 
$
(37,340
)
 
$
(12,015
)
Income tax expense (benefit)
 
35

 
—

 
(10,392
)
 
(10,357
)
Non-operating (income) expense, including net interest expense
 
(1
)
 
320

 
33,928

 
34,247

LMA fees
 
2,498

 
—

 
—

 
2,498

Depreciation and amortization
 
15,532

 
9,312

 
467

 
25,311

Stock-based compensation expense
 
—

 
—

 
3,863

 
3,863

Loss on sale of assets or stations
 
819

 
—

 
—

 
819

Franchise and state taxes
 
—

 
—

 
297

 
297

Adjusted EBITDA
 
$
45,416

 
$
8,424

 
$
(9,177
)
 
$
44,663


 
 
Three Months Ended June 30, 2015
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net income (loss)
 
$
52,567

 
$
7,568

 
$
(47,836
)
 
$
12,299

Income tax (benefit) expense
 
(35
)
 
—

 
12,729

 
12,694

Non-operating expense, including net interest expense
 
(2
)
 
320

 
22,693

 
23,011

LMA fees
 
2,572

 
—

 
—

 
2,572

Depreciation and amortization
 
16,014

 
9,158

 
551

 
25,723

Stock-based compensation expense
 
—

 
—

 
3,880

 
3,880

Gain on sale of assets or stations
 
(84
)
 
—

 
—

 
(84
)
Impairment charges - equity interest in Pulser Media Inc.
 
—

 
1,056

 
—

 
1,056

Acquisition-related and restructuring costs
 
—

 
410

 
(1,013
)
 
(603
)
Franchise and state taxes
 
—

 
—

 
267

 
267

Adjusted EBITDA
 
$
71,032

 
$
18,512

 
$
(8,729
)
 
$
80,815





 
 
Three Months Ended December 31, 2015
 
 
Radio Station Group
 
Westwood One
 
Corporate and Other
 
Consolidated
Net income (loss)
 
$
43,776

 
$
(2,195
)
 
$
(46,180
)
 
$
(4,599
)
Income tax expense
 
—

 
—

 
12,680

 
12,680

Non-operating (income) expense, including net interest expense
 
(2
)
 
293

 
33,671

 
33,962

LMA fees
 
2,541

 
—

 
3

 
2,544

Depreciation and amortization
 
15,894

 
8,976

 
653

 
25,523

Stock-based compensation expense
 
—

 
—

 
986

 
986

(Gain) loss on sale of assets or stations
 
(17
)
 
2,081

 
—

 
2,064

Acquisition-related and restructuring costs
 
—

 
747

 
2,733

 
3,480

Franchise and state taxes
 
—

 
—

 
(371
)
 
(371
)
Gain on early extinguishment of debt
 
—

 
—

 
(13,222
)
 
(13,222
)
Adjusted EBITDA
 
$
62,192

 
$
9,902

 
$
(9,047
)
 
$
63,047







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