EX-99.1 2 d139493dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

LOGO

Entercom Communications Corp.

Reports Fourth Quarter and Full Year Results

(Bala Cynwyd, Pa. February 11, 2016) Entercom Communications Corp. (NYSE: ETM) today reported financial results for the quarter ended December 31, 2015.

Fourth Quarter Highlights

 

    Net revenues for the quarter increased 16% to $117.7 million

 

    Station expenses increased 21% to $76.7 million

 

    Station operating income increased 7% to $41.0 million

 

    Adjusted EBITDA increased 7% to $35.2 million

 

    Adjusted net income per share increased 3% to $0.35

 

    Free cash flow increased 9% to $25.5 million

Full Year Highlights

 

    Net revenues for the year increased 8% to $411.4 million

 

    Station expenses increased 11% to $286.5 million

 

    Station operating income increased 3% to $124.9 million

 

    Adjusted EBITDA increased 3% to $102.7 million

 

    Adjusted net income per share increased 6% to $0.87

 

    Free cash flow increased 9% to $61.4 million

Fourth quarter and full year operating results include the impact of the transaction with Lincoln Financial Media and the station exchange with Bonneville International Corporation which started in July.

David J. Field, President and Chief Executive Officer, stated: “I am pleased to report that Entercom’s performance continued to accelerate into fourth quarter capping a very successful 2015 for the Company. Fourth quarter same-station revenues increased by 5%, excluding political advertising. This marked the second straight quarter of mid-single digit organic growth. We are very well positioned for success in 2016 with an expanded market footprint, strong station ratings growth, and enhanced digital and customer marketing capabilities. Our pacings look strong and we are optimistic about our potential to deliver excellent results for our shareholders in 2016 and the years ahead.”

Additional Information

As of December 31, 2015 the Company had $487.0 million of senior debt and senior notes and $9.2 million in cash. In addition, the Company had $27.6 million in perpetual cumulative convertible preferred stock.

In November, the Company completed its station exchange with Bonneville through which it acquired Los Angeles station KSWD-FM in exchange for stations Entercom owned in Denver. Prior to closing, the Company operated KSWD-FM under a time brokerage agreement which commenced in July and at which point the Company began to include KSWD’s operating results in its financials.

 

Exhibit 99.1 – Page 1


The Company’s fully diluted share count includes the impact of its Series A Convertible Preferred Stock treated on an “as-converted” basis when dilutive to per share metrics. This required accounting treatment increased fourth quarter fully diluted shares by 1.9 million.

Earnings Conference Call and Company Information

Entercom will hold a conference call regarding the quarterly earnings release on Thursday, February 11, 2016 at 10:30 AM Eastern Time. Investors will have the opportunity to submit questions to the Company regarding the earnings release by emailing their inquiries to questions@entercom.com. Questions should be sent at least 10 minutes prior to the call. The Company will only discuss inquiries made by email prior to the conference call. The public may access the conference call by dialing 888-889-0278 (passcode: Entercom). A replay of the conference call will be available and can be accessed either by dialing 888-566-0496 or by visiting the Company’s website: www.entercom.com. Additional information and reconciliation of same station results are available on the Company’s website at www.entercom.com.

About Entercom

Entercom Communications Corp. (NYSE: ETM), is the fourth-largest radio broadcasting company in the United States, with a portfolio of 125 highly-rated radio stations in 27 top markets across the country. Known for developing unique and highly successful locally programmed stations, Entercom’s brands reach and engage close to 40 million people each week, delivering a curated mix of outstanding local personalities and a broad range of compelling music, news, talk and sports content.

Founded in 1968, Philadelphia-based Entercom also operates hundreds of events each year attracting millions of attendees, and provides customers with a broad range of digital marketing solutions through its SmartReach Digital products.

More information is available 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 and restructuring charges; and gain or loss on sale or disposition of assets.

 

Exhibit 99.1 – Page 2


Adjusted EBITDA consists of net income (loss) available to common shareholders, adjusted to exclude: income taxes (benefit); total other 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); impairment loss; merger and acquisition costs, preferred stock dividends and restructuring charges; and gain or loss on sale or disposition of assets.

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 and restructuring charges; and (ii) less net interest expense (excluding amortization of deferred financing costs), preferred stock dividends, taxes paid and capital expenditures.

Adjusted Net Income (Loss) consists of net income (loss) available to common shareholders adjusted to exclude: (i) income taxes (benefit) as reported; (ii) gain/loss on sale of assets, derivative instruments and investments; (iii) non-cash compensation expense; (iv) other income; (v) impairment loss; (vi) merger and acquisition costs and restructuring charges; 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 40% without discrete items of tax.

Adjusted Net Income Per Share includes any dilutive equivalent shares when not anti-dilutive.

Same station 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 (excluding non-cash compensation expense). Any acquisition or disposition of radio stations not deemed to be material by management is ignored for the purpose of computing this data.

Non-GAAP Financial Measures

It is important to note that station operating income, station expense, corporate expense, same station net revenues, same station expenses, same station operating income, Adjusted EBITDA, Adjusted Net Income, Adjusted Net Income Per Share 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 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 and Adjusted Net Income Per Share). The adjustments exclude gain/loss on sale of assets, derivative instruments, and investments; non-cash compensation expense, other income, impairment loss and gain/loss on early extinguishment of debt. 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.

 

Exhibit 99.1 – Page 3


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 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 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.

Contact:

Steve Fisher

Executive Vice President and Chief Financial Officer

610-660-5647

 

Exhibit 99.1 – Page 4


Fourth Quarter 2015

Earnings Release

ENTERCOM COMMUNICATIONS CORP.

FINANCIAL DATA

(amounts in thousands, except per share data)

(unaudited)

 

     Three Months Ended
December 31,
    Year Ended
December 31,
 
     2015     2014     2015     2014  

STATEMENTS OF OPERATIONS

        

Net Revenues

   $ 117,704      $ 101,513      $ 411,378      $ 379,789   
  

 

 

   

 

 

   

 

 

   

 

 

 

Station Expenses

     76,724        63,265        286,452        258,265   

Station Expense - Non-Cash Compensation

     379        247        1,259        919   

Corporate Expenses

     5,741        5,244        22,214        22,259   

Corporate Expenses - Non-Cash Compensation

     1,048        1,234        4,265        4,313   

Depreciation And Amortization

     2,340        1,997        8,419        7,794   

Time Brokerage Agreement Income

     (540     —          (1,285     —     

Merger And Acquisition Costs And Restructuring Charges

     1,104        1,042        6,836        1,042   

Net Gain On Sale Or Disposition of Assets

     (1,647     (47     (2,364     (379
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Operating Expenses

     85,149        72,982        325,796        294,213   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

     32,555        28,531        85,582        85,576   
  

 

 

   

 

 

   

 

 

   

 

 

 

Other Expense (Income) Items:

        

Net Interest Expense

     9,638        9,354        37,961        38,821   

Net Loss On Investments

     —          21        —          21   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Other Expense

     9,638        9,375        37,961        38,842   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income Before Income Taxes

     22,917        19,156        47,621        46,734   

Income Taxes

     8,829        8,306        18,437        19,911   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income Available To The Company

     14,088        10,850        29,184        26,823   

Preferred Stock Dividend

     413        —          752        —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income Available To Common Shareholders

   $ 13,675      $ 10,850      $ 28,432      $ 26,823   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income Available To Common Shareholders Per Share - Basic

   $ 0.36      $ 0.29      $ 0.75      $ 0.71   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income Available To Common Shareholders Per Share - Diluted

   $ 0.34      $ 0.28      $ 0.73      $ 0.69   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted Common Shares Outstanding - Basic

     38,088        37,779        38,084        37,763   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted Common Shares Outstanding - Diluted

     40,974        38,730        39,038        38,664   
  

 

 

   

 

 

   

 

 

   

 

 

 

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

        

Capital Expenditures

   $ 1,069      $ 1,018      $ 7,043      $ 8,408   

Income Taxes Paid

   $ —        $ —        $ 81      $ 79   

Cash Interest

   $ 14,284      $ 14,595      $ 34,822      $ 35,593   

Cash Dividends On Preferred Stock

   $ 413      $ —        $ 412      $ —     
SELECTED BALANCE SHEET DATA    December 31,              
     2015     2014              

Cash and Cash Equivalents

   $ 9,169      $ 31,540       

Total Assets

   $ 1,022,108      $ 926,615       

Current Portion Of Senior Debt

   $ 31,832      $ 3,000       

Senior Debt (including Current Debt)

   $ 268,750      $ 262,000       

Senior Notes

   $ 218,269      $ 217,929       

Perpetual Cumulative Convertible Preferred Stock

   $ 27,619      $ —         

Total Shareholders’ Equity

   $ 361,450      $ 329,021       

 

Exhibit 99.1 – Page 5


OTHER FINANCIAL DATA

 

     Three Months Ended
December 31,
    Year Ended
December 31,
 
     2015     2014     2015     2014  
Reconciliation Of GAAP Station Operating Expenses To Station Expenses         

Station Operating Expenses

   $ 77,103      $ 63,512      $ 287,711      $ 259,184   

Station Expenses - Non-Cash Compensation

     (379     (247     (1,259     (919
  

 

 

   

 

 

   

 

 

   

 

 

 

Station Expenses

   $ 76,724      $ 63,265      $ 286,452      $ 258,265   
  

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation Of GAAP Corporate General & Administrative Expenses To Corporate Expenses

        

Corporate General & Administrative Expenses

   $ 6,789      $ 6,478      $ 26,479      $ 26,572   

Corporate Expenses - Non-Cash Compensation

     (1,048     (1,234     (4,265     (4,313
  

 

 

   

 

 

   

 

 

   

 

 

 

Corporate Expenses

   $ 5,741      $ 5,244      $ 22,214      $ 22,259   
  

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation Of GAAP Operating Income To Station Operating Income

        

Operating Income

   $ 32,555      $ 28,531      $ 85,582      $ 85,576   

Corporate Expenses

     5,741        5,244        22,214        22,259   

Corporate Expenses - Non-Cash Compensation

     1,048        1,234        4,265        4,313   

Station Expenses - Non-Cash Compensation

     379        247        1,259        919   

Depreciation And Amortization

     2,340        1,997        8,419        7,794   

Merger And Acquisition Costs And Restructuring Charges

     1,104        1,042        6,836        1,042   

Time Brokerage Agreement Income

     (540     —          (1,285     —     

Net Gain On Sale Or Disposition of Assets

     (1,647     (47     (2,364     (379
  

 

 

   

 

 

   

 

 

   

 

 

 

Station Operating Income

   $ 40,980      $ 38,248      $ 124,926      $ 121,524   
  

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation Of GAAP Net Income Available To Common Shareholders To Adjusted EBITDA

        

Net Income Available To Common Shareholders

   $ 13,675      $ 10,850      $ 28,432      $ 26,823   

Income Taxes

     8,829        8,306        18,437        19,911   

Total Other Expense

     9,638        9,375        37,961        38,842   

Corporate Expenses- Non-Cash Compensation

     1,048        1,234        4,265        4,313   

Station Expenses- Non-Cash Compensation

     379        247        1,259        919   

Depreciation And Amortization

     2,340        1,997        8,419        7,794   

Time Brokerage Agreement Income

     (540     —          (1,285     —     

Preferred Stock Dividend

     413        —          752        —     

Merger And Acquisition Costs And Restructuring Charges

     1,104        1,042        6,836        1,042   

Net Gain On Sale Or Disposition of Assets

     (1,647     (47     (2,364     (379
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

   $ 35,239      $ 33,004      $ 102,712      $ 99,265   
  

 

 

   

 

 

   

 

 

   

 

 

 
     Three Months Ended
December 31,
    Year Ended
December 31,
 
     2015     2014     2015     2014  

Reconciliation Of GAAP Net Income Available To Common Shareholders To Free Cash Flow

        

Net Income Available To Common Shareholders

   $ 13,675      $ 10,850      $ 28,432      $ 26,823   

Depreciation And Amortization

     2,340        1,997        8,419        7,794   

Deferred Financing Costs Included In Interest Expense

     710        695        2,863        3,860   

Amortization Of Original Issue Discount Included In Interest Expense

     89        79        340        305   

Non-Cash Compensation Expense

     1,427        1,481        5,524        5,232   

Merger And Acquisition Costs And Restructuring Charges

     1,104        1,042        6,836        1,042   

Net Gain On Sale Or Disposition of Assets

     (1,647     (47     (2,364     (379

Net Loss On Investments

     —          21        —          21   

Income Taxes

     8,829        8,306        18,437        19,911   

Capital Expenditures

     (1,069     (1,018     (7,043     (8,408

Income Taxes Paid

     —          —          (81     (79
  

 

 

   

 

 

   

 

 

   

 

 

 

Free Cash Flow

   $ 25,458      $ 23,406      $ 61,363      $ 56,122   
  

 

 

   

 

 

   

 

 

   

 

 

 

 

Exhibit 99.1 – Page 6


     Three Months Ended
December 31,
    Year Ended
December 31,
 
     2015     2014     2015     2014  

Reconciliation Of GAAP Operating Income To Free Cash Flow:

        

Operating Income

   $ 32,555      $ 28,531      $ 85,582      $ 85,576   

Depreciation and Amortization

     2,340        1,997        8,419        7,794   

Non-Cash Compensation Expense

     1,427        1,481        5,524        5,232   

Interest Expense, Net of Interest Income, Deferred Financing Costs & OID

     (8,839     (8,580     (34,758     (34,656

Preferred Stock Dividend

     (413     —          (752     —     

Capital Expenditures

     (1,069     (1,018     (7,043     (8,408

Merger And Acquisition Costs And Restructuring Charges

     1,104        1,042        6,836        1,042   

Net (Gain) Loss On Sale Or Disposition of Assets

     (1,647     (47     (2,364     (379

Income Taxes Paid

     —          —          (81     (79
  

 

 

   

 

 

   

 

 

   

 

 

 

Free Cash Flow

   $ 25,458      $ 23,406      $ 61,363      $ 56,122   
  

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation Of GAAP Net Income Available To Common Shareholders To Adjusted Net Income

        

Net Income Available To Common Shareholders

   $ 13,675      $ 10,850      $ 28,432      $ 26,823   

Preferred Stock Dividend

     413        —          752        —     

Income Taxes

     8,829        8,306        18,437        19,911   

Merger And Acquisition Costs And Restructuring Charges

     1,104        1,042        6,836        1,042   

Net Gain On Sale Or Disposition of Assets

     (1,647     (47     (2,364     (379

Net Loss On Investments

     —          21        —          21   

Non-Cash Compensation Expense

     1,427        1,481        5,524        5,232   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Income Before Income Taxes

     23,801        21,653        57,617        52,650   

Income Taxes

     9,520        8,661        23,047        21,060   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Net Income Available To The Company

     14,281        12,992        34,570        31,590   

Preferred Stock Dividend

     413        —          752        —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Net Income

   $ 13,868      $ 12,992      $ 33,818      $ 31,590   
  

 

 

   

 

 

   

 

 

   

 

 

 

Numerator For Purposes Of Computing Adjusted Net Income Per Share - Diluted

        

Adjusted Net Income

   $ 13,868      $ 12,992      $ 33,818      $ 31,590   

Preferred Stock Dividend, As If Converted Unless Anti-Dilutive

     413        —          752        —     
  

 

 

   

 

 

   

 

 

   

 

 

 
   $ 14,281      $ 12,992      $ 34,570      $ 31,590   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted Average Diluted Shares Outstanding For Purposes Of Computing Adjusted Net Income Per Share - Diluted

        

Weighted Common Shares Outstanding - Diluted As Reported

     40,974        38,730        39,038        38,664   

Preferred Stock, As If Converted Unless Anti-Dilutive

     —          —          882        —     
  

 

 

   

 

 

   

 

 

   

 

 

 
     40,974        38,730        39,920        38,664   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Net Income Per Share - Diluted

   $ 0.35      $ 0.34      $ 0.87      $ 0.82   
  

 

 

   

 

 

   

 

 

   

 

 

 

 

Exhibit 99.1 – Page 7