EX-99.1 2 a05-14525_1ex99d1.htm EX-99.1

Exhibit 99.1

 

Entercom Communications Corp.

Reports Record Quarterly Results

 

Same Station Net Revenues Increase 4%

Net Income per Share Increases 13%

 

(Bala Cynwyd, Pa. August 9, 2005) Entercom Communications Corp. (NYSE: ETM) today reported record financial results for the quarter ended June 30, 2005.

 

The Company achieved record-breaking results, for any quarter, in net revenues and station operating income and record-breaking results for a second quarter in station operating income margin, operating income, net income and net income per share.

 

For the second quarter as compared to the prior year:

 

•                  Net revenues increased 5% to $119.5 million and station operating income increased 5% to $54.0 million.

•                  Same station net revenues increased 4% to $119.5 million and same station operating expenses increased 3% to $65.5 million.

•                  Same station operating income increased 5% to $54.0 million.

•                  Net income per share increased 13% to $0.53.

•                  Pro forma net income per share, excluding gain/loss on sale or disposition of assets, financial instruments and investments, increased 13% to $0.52 from $0.46.

 

David J. Field, President and Chief Executive Officer stated, “We are pleased to report that Entercom delivered record-breaking results during the second quarter.   Same-station revenue grew 4%, outpacing our markets by 300 bps, notwithstanding the dampening effect of several format changes made during the quarter.  Local revenues remained strong, growing at 6%.  We also continued to enhance our future prospects by investing in compelling new formats and programming content, proprietary sales initiatives and technology. “

 

Additional Information

 

The Company has reached a multi-year agreement to carry the Boston Celtics game broadcasts, and related programming and promotional events, on the Company’s Boston stations beginning with the upcoming 2005-2006 NBA season.

 

The Company recognized a positive benefit to income taxes of $0.3 million in the second quarter from adjustments to state tax provisions.

 

The number of shares outstanding as of June 30, 2005, was 45.9 million, while the weighted average diluted shares outstanding for the quarter was 46.1 million. During the quarter, the

 

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Company repurchased 0.2 million shares of common stock for $5.0 million under the Company’s third repurchase program.

 

As of June 30, 2005, the Company had $11.1 million in cash and cash equivalents. The Company had outstanding $374 million of Senior Debt and $150 million of Senior Subordinated Notes due in 2014.

 

Third Quarter Guidance

 

Based on the current business outlook, the Company expects to report an increase in same station net revenues of 3% to 4% and station operating expenses of approximately 3%.

 

The Company has restructured its contractual relationship with the Seattle Seahawks professional football team effective with the 2005 NFL season.  While the Company will continue to broadcast the games, the Company will no longer produce the games nor sell the advertising time as in past years.

 

For purposes of same station comparisons, as adjusted for the Seattle Seahawks, last year’s same station third quarter net revenues were $111.3 million and station operating expenses were $61.8 million.

 

Reconciliation of prior year reported and same station results are available on the Company’s website.

 

Earnings Conference Call and Company Information

 

The Company will hold a conference call regarding the quarterly earnings release on Tuesday, August 9 at 9:30 AM Eastern Time.   The public may access the conference call by dialing 888-577-8990.  A replay of the conference call will be available through August 16, 2005 by dialing 866-353-3069.   A webcast of the conference call will be available beginning 24 hours after the call on the Company’s website for a period of one week.  The Company’s website is located at www.entercom.com.

 

Entercom is the nation’s fourth largest radio broadcaster, operating in Boston, Seattle, Denver, Portland, Sacramento, Kansas City, Indianapolis, Milwaukee, New Orleans, Norfolk, Buffalo, Memphis, Providence, Greensboro, Greenville/Spartanburg, Rochester, Madison, Wichita, Wilkes- Barre/Scranton and Gainesville/Ocala.

 

Certain Definitions

 

All references to per share data, unless stated otherwise, are presented as per diluted share.

 

It is important to note that station operating income, same station net revenues, same station operating expenses, same station operating income and free cash flow 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 to measure a radio company’s operating performance. You should not consider these non-GAAP measures in isolation or as substitutes for net income, operating income, or any other measure for determining our operating performance that

 

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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.

 

Station operating income consists of operating income before depreciation and amortization, time brokerage agreement fees, corporate general and administrative expenses and gain or loss on sale or disposition of assets.

 

Free cash flow consists of operating income: (i) plus depreciation and amortization, non-cash compensation expense (which is otherwise included in corporate general and administrative expenses); and (ii) less net interest expense (excluding amortization of deferred financing costs), gain (loss) on sale of assets, taxes paid (refunded) and capital expenditures.

 

Same station operating data is computed by comparing the performance of stations operated by the Company throughout the relevant period to the comparable performance in the prior year’s corresponding period. The Company includes in the same station operating data the effects of changes in status of significant contracts that: (i) relate to operations; (ii) have a significant effect on the net revenues and or station operating expenses of a particular market; and (iii) are accounted for as a separate business unit.

 

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 pro forma 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 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 reflects adjustments and is presented for comparative purposes only and does 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.

 

Contact:

Steve Fisher

Executive Vice President and Chief Financial Officer

610-660-5647

 

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Entercom Second Quarter 2005

Earnings Release

 

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED FINANCIAL DATA

(amounts in thousands, except per share data)

(Unaudited)

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

June 30,

 

June 30,

 

 

 

2005

 

2004

 

2005

 

2004

 

CONDENSED STATEMENTS OF OPERATIONS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Revenues

 

$

119,489

 

$

113,677

 

$

213,796

 

$

200,715

 

 

 

 

 

 

 

 

 

 

 

Station Operating Expenses

 

65,493

 

62,356

 

124,001

 

116,879

 

Corporate General and Administrative Expenses, Including Non-Cash Compensation Expense of $217 and $172 for the Three Months Ended June 30, 2005 and 2004, Respectively and $446 and $317 for the Six Months Ended June 30, 2005 and 2004, Respectively.

 

4,618

 

3,943

 

9,598

 

7,651

 

Depreciation and Amortization

 

3,947

 

3,778

 

7,983

 

7,780

 

Time Brokerage Agreement Expense (Income)

 

—

 

181

 

(24

)

181

 

Net Loss (Gain) on Sale or Disposition of Assets

 

41

 

718

 

(5,492

)

749

 

Operating Income

 

45,390

 

42,701

 

77,730

 

67,475

 

 

 

 

 

 

 

 

 

 

 

Other Expense (Income) Items:

 

 

 

 

 

 

 

 

 

Interest Expense, Including Amortization of Deferred Financing Costs of $329 and $244 for the Three Months Ended June 30, 2005 and 2004, Respectively and $658 and $488 for the Six Months Ended June 30, 2005 and 2004, Respectively.

 

7,384

 

4,800

 

14,002

 

9,618

 

Interest Income

 

(78

)

(43

)

(134

)

(109

)

Net Loss (Gain) on Derivative Instruments

 

166

 

(1,361

)

(544

)

(1,031

)

(Gain) Loss on investments

 

(1,028

)

176

 

(1,069

)

176

 

Total Other Expense

 

6,444

 

3,572

 

12,255

 

8,654

 

 

 

 

 

 

 

 

 

 

 

Income Before Income Taxes

 

38,946

 

39,129

 

65,475

 

58,821

 

Income Taxes

 

14,671

 

15,097

 

24,963

 

22,825

 

Net Income

 

$

24,275

 

$

24,032

 

$

40,512

 

$

35,996

 

Net Income Per Share - Basic

 

$

0.53

 

$

0.47

 

$

0.87

 

$

0.70

 

Net Income Per Share - Diluted

 

$

0.53

 

$

0.47

 

$

0.86

 

$

0.70

 

 

 

 

 

 

 

 

 

 

 

Weighted Common Shares Outstanding - Basic

 

45,855

 

51,051

 

46,739

 

51,270

 

Weighted Common Shares Outstanding - Diluted

 

46,136

 

51,413

 

47,022

 

51,716

 

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

 

 

 

 

 

 

 

 

 

Capital Expenditures

 

$

2,935

 

$

1,639

 

$

4,822

 

$

3,365

 

Income Taxes Paid

 

$

4,438

 

$

5,350

 

$

6,874

 

$

6,535

 

 

 

 

 

 

 

 

 

 

 

SELECTED BALANCE SHEET DATA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

 

2005

 

2004

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and Cash Equivalents

 

$

11,108

 

$

12,184

 

 

 

 

 

Working Capital

 

87,612

 

19,818

 

 

 

 

 

Total Assets

 

1,674,773

 

1,682,584

 

 

 

 

 

Senior Debt

 

373,768

 

264,535

 

 

 

 

 

7.625% Senior Subordinated Notes

 

150,000

 

150,000

 

 

 

 

 

Total Shareholders’ Equity

 

942,163

 

1,019,788

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER FINANCIAL DATA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

 

2005

 

2004

 

 

 

 

 

Same Station Computations:

 

 

 

 

 

 

 

 

 

Net Revenues - Reconciliation of Same Station Net Revenues to GAAP:

 

 

 

 

 

 

 

 

 

Net Revenues as Reported

 

$

119,489

 

$

113,677

 

 

 

 

 

Net Acquisitions and Divestitures of Radio Stations and Significant Contracts

 

—

 

1,183

 

 

 

 

 

Same Station Net Revenues

 

$

119,489

 

$

114,860

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Station Operating Expenses - Reconciliation of Same Station Operating

 

 

 

 

 

 

 

 

 

Expenses to GAAP:

 

 

 

 

 

 

 

 

 

Station Operating Expenses as Reported

 

$

65,493

 

$

62,356

 

 

 

 

 

Net Acquisitions and Divestitures of Radio Stations and Significant Contracts

 

—

 

1,078

 

 

 

 

 

Same Station Operating Expenses

 

$

65,493

 

$

63,434

 

 

 

 

 

 

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Reconciliation of Station Operating Income and Same Station Operating Income to GAAP (Operating Income):

 

 

 

 

 

 

 

 

 

Operating Income as Reported

 

$

45,390

 

$

42,701

 

 

 

 

 

Corporate General and Administrative Expenses

 

4,618

 

3,943

 

 

 

 

 

Depreciation and Amortization

 

3,947

 

3,778

 

 

 

 

 

Net Time Brokerage Agreement Fees

 

—

 

181

 

 

 

 

 

Net Loss on Sale or Disposition of Assets

 

41

 

718

 

 

 

 

 

Station Operating Income

 

53,996

 

51,321

 

 

 

 

 

Net Acquisitions and Divestitures of Radio Stations and Significant Contracts

 

—

 

105

 

 

 

 

 

Same Station Operating Income

 

$

53,996

 

$

51,426

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Free Cash Flow to GAAP (Net Income):

 

 

 

 

 

 

 

 

 

Net Income as Reported

 

$

24,275

 

$

24,032

 

 

 

 

 

Depreciation and Amortization

 

3,947

 

3,778

 

 

 

 

 

Deferred Financing Costs Included in Interest Expense

 

329

 

244

 

 

 

 

 

Non-Cash Compensation Expense

 

217

 

172

 

 

 

 

 

Net Loss on Sale or Disposition of Assets

 

41

 

718

 

 

 

 

 

Net Loss (Gain) on Derivative Instruments

 

166

 

(1,361

)

 

 

 

 

(Gain) Loss on investments

 

(1,028

)

176

 

 

 

 

 

Income Taxes

 

14,671

 

15,097

 

 

 

 

 

Capital Expenditures

 

(2,935

)

(1,639

)

 

 

 

 

Taxes Paid

 

(4,438

)

(5,350

)

 

 

 

 

Free Cash Flow

 

$

35,245

 

$

35,867

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Free Cash Flow to GAAP (Operating Income):

 

 

 

 

 

 

 

 

 

Operating Income as Reported

 

$

45,390

 

$

42,701

 

 

 

 

 

Depreciation and Amortization

 

3,947

 

3,778

 

 

 

 

 

Non-Cash Compensation Expense

 

217

 

172

 

 

 

 

 

Interest Expense, Net of Interest Income and Deferred Financing Costs

 

(6,977

)

(4,513

)

 

 

 

 

Capital Expenditures

 

(2,935

)

(1,639

)

 

 

 

 

Net Loss on Sale or Disposition of Assets

 

41

 

718

 

 

 

 

 

Taxes Paid

 

(4,438

)

(5,350

)

 

 

 

 

Free Cash Flow

 

$

35,245

 

$

35,867

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Pro Forma Net Income Per Share - Diluted to GAAP

 

 

 

 

 

 

 

 

 

Net Income Per Share - Diluted as Reported

 

$

0.53

 

$

0.47

 

 

 

 

 

Net Loss on Sale or Disposal of Assets, Net of Tax Benefit

 

—

 

0.01

 

 

 

 

 

Net Loss (Gain) on Derivative Instruments, Net of Tax Benefit or Tax Provision

 

—

 

(0.02

)

 

 

 

 

(Gain) Loss on Investments, Net of Tax Provision or Tax Benefit

 

(0.01

)

—

 

 

 

 

 

Pro Forma Net Income Per Share - Diluted

 

$

0.52

 

$

0.46

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted Common Shares Outstanding - Basic

 

45,855

 

51,051

 

 

 

 

 

Weighted Common Shares Outstanding - Diluted

 

46,136

 

51,413

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PRIOR YEAR’S DATA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter 2004 For Comparison To Third Quarter 2005 Estimates

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three

 

 

 

 

 

 

 

 

 

Months

 

 

 

 

 

 

 

 

 

Ended

 

 

 

 

 

 

 

 

 

Sept. 30,

 

 

 

 

 

 

 

 

 

2004

 

 

 

 

 

Reconciliation of Third Quarter 2004 Same Station Net Revenues to GAAP (Net Revenues):

 

 

 

 

 

 

 

 

 

Net Revenues as Reported

 

 

 

$

112,507

 

 

 

 

 

Net Acquisitions and Divestitures of Radio Stations and Significant Contracts

 

 

 

(1,212

)

 

 

 

 

Same Station Net Revenues

 

 

 

$

111,295

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Third Quarter 2004 Same Station Operating Expenses to GAAP (Station Operating Expenses):

 

 

 

 

 

 

 

 

 

Station Operating Expenses as Reported

 

 

 

$

63,530

 

 

 

 

 

Net Acquisitions and Divestitures of Radio Stations and Significant Contracts

 

 

 

(1,759

)

 

 

 

 

Same Station Operating Expenses

 

 

 

$

61,771

 

 

 

 

 

 

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