EX-99.1 2 b76668exv99w1.htm EX-99.1 exv99w1
EXHIBIT 99.1
Saga Communications, Inc.
Reports 2nd Quarter 2009 Results
Contact:
Samuel D. Bush
313/886-7070
Grosse Pointe Farms, MI – August 6, 2009 – Saga Communications, Inc. (NYSE Amex-SGA) today reported that 2nd quarter 2009 free cash flow increased 1.2% to $6.0 million compared to $5.9 million for the same period last year. Net operating revenue decreased 15.3% from the comparable period in 2008 to $31.6 million and operating income decreased to $6.2 million. Net income was $2.7 million ($.63 per fully diluted share) for the quarter ended June 30, 2009 compared to $3.5 million ($.70 per fully diluted share) for the comparable period in 2008. For the same period, station operating expense decreased $4.0 million to $23.3 million (station operating expense includes depreciation and amortization attributable to the stations). A large part of the decrease in station operating expense was a result of our cost reduction initiatives. This helped to reduce the impact that the decline in net operating revenue had on our operating results. On a same station basis for the quarter, net operating revenue decreased 16.3% to $31.3 million, operating income was $6.0 million and station operating expense decreased $4.1 million to $23.1 million.
For the six month period ended June 30, 2009, free cash flow decreased $653 thousand to $6.9 million. Net operating revenue decreased 16.1% from the comparable period in 2008 to $57.8 million and operating income was $6.3 million. Net income was $2.3 million ($.55 per fully diluted share) compared to $4.4 million ($.88 per fully diluted share) for the comparable period in 2008. For the same period, station operating expense decreased $5.4 million to $47.2 million (station operating expense includes depreciation and amortization attributable to the stations). On a same station basis for the six months, net operating revenue decreased 17.0% to $57.2 million, operating income was $6.1 million and station operating expense decreased $5.8 million to $46.9 million.
All share and per share information has been adjusted for the Company’s January 28, 2009 1-for-4 reverse stock split.

 

 

Capital expenditures in the second quarter of 2009 were $1.5 million. For the six months, capital expenditures were $2.6 million. Currently we expect capital expenditures for the year to be approximately $3.5 – $4.0 million.
The attached Selected Supplemental Financial Data table discloses “as reported” and “same station” information by segment. The “as reported” amounts reflect our historical financial results and include the results of operations for stations that we did not own for the entire comparable period. The “same station” amounts reflect only the results of operations for stations that we owned for the entire comparable period.
Saga Communications utilizes certain financial measures that are not calculated in accordance with generally accepted accounting principles (GAAP) to assess its financial performance. Such non-GAAP measures include same station financial information and free cash flow. These non-GAAP measures are generally recognized by the broadcasting industry as measures of performance and are used by Saga to assess its financial performance including but not limited to evaluating individual station and market-level performance, evaluating overall operations and as a primary measure for incentive based compensation of executives and other members of management. Saga’s management believes these non-GAAP measures are used by analysts who report on the industry and by investors to provide meaningful comparisons between broadcasting groups, as well as an indicator of their market value. These measures are not measures of liquidity or of performance in accordance with GAAP, and should be viewed as a supplement to and not as a substitute for the results of operations presented on a GAAP basis including net operating revenue, operating income, and net income. Reconciliations for all of the non-GAAP financial measures to the most directly comparable GAAP measure are attached in the Selected Financial Data Non-GAAP Disclosures tables.
Saga Communications, Inc. is a broadcasting company whose business is devoted to acquiring, developing and operating broadcast properties. The Company owns or operates broadcast properties in 26 markets, including 61 FM and 30 AM radio stations, 3 state radio networks, 2 farm radio networks, 5 television stations and 4 low-power television stations. For additional information, contact us at (313) 886-7070 or visit our website at www.sagacommunications.com.
Saga’s second quarter 2009 results conference call will be on Thursday, August 6, 2009 at 2:00 PM EDT. The dial in number for domestic and international calls is 612/332-0107. The call can be replayed for 7 days by calling domestically 800/475-6701 or internationally 320/365-3844 and referring to access code 105208. Thereafter, a transcript of the call will be available on our website.
The Company requests that all parties that have a question that they would like to submit to the Company to please email the inquiry by 1:00 PM EDT on August 6, 2009 to SagaIR@sagacom.com. The Company will discuss, during the limited period of the conference call, those inquiries it deems of general relevance and interest. Only inquiries made in compliance with the foregoing will be discussed during the call.

 

 

This press release contains certain forward-looking statements that are based upon current expectations and involve certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Words such as “believes,” “expects,” “anticipates,” “guidance” and similar expressions are intended to identify forward-looking statements. Key risks, including risks associated with Saga’s ability to effectively integrate the stations it acquires and the impact of federal regulation on Saga’s business, are described in the reports Saga Communications, Inc. periodically files with the U.S. Securities and Exchange Commission, including Item 1A of our annual report on Form 10-K. Readers should note that these statements may be impacted by several factors, including national and local economic changes and changes in the radio and television broadcast industry in general, as well as Saga’s actual performance. Results may vary from those stated herein and Saga undertakes no obligation to update the information contained here.

 

 

Saga Communications, Inc.
Selected Consolidated Financial Data
For The Three and Six Months Ended
June 30, 2009 and 2008
(amounts in 000’s except per share data)
(Unaudited)
                                 
    Three Months Ended   Six Months Ended
    June 30,   June 30,
    2009   2008   2009   2008
     
Operating Results
                                
Net operating revenue
   $     31,637     $     37,342     $     57,761     $     68,874  
Station operating expense
     23,295       27,246       47,235       52,667  
Corporate general and administrative
     2,158       2,574       4,225       5,126  
Gain on asset exchange
     —       (224 )     —       (224 )
     
Operating income
     6,184       7,746       6,301       11,305  
Interest expense
     1,430       1,876       2,203       3,871  
Other expense (income), net
     (28 )     7       (32 )     27  
     
Income before income tax
     4,782       5,863       4,130       7,407  
Income tax expense
     2,108       2,403       1,818       3,037  
     
Net income
   $ 2,674     $ 3,460     $ 2,312     $ 4,370  
     
Earnings per share
                                
Basic
   $ 0.63     $ 0.70     $ 0.55     $ 0.88  
     
Diluted
   $ 0.63     $ 0.70     $ 0.55     $ 0.88  
     
Weighted average common shares
     4,226       4,950       4,192       4,983  
Weighted average common shares and common shares equivalents
     4,227       4,951       4,193       4,984  
 
                                
Free Cash Flow
                                
Net income
   $ 2,674     $ 3,460     $ 2,312     $ 4,370  
Plus: Depreciation and amortization:
                                
Station
     2,180       2,196       4,377       4,153  
Corporate
     48       53       109       106  
Deferred tax provision
     2,253       1,524       2,038       1,926  
Non-cash compensation
     343       354       670       720  
Gain on asset exchange
     —       (224 )     —       (224 )
Other expense (income), net
     (28 )     7       (32 )     27  
Less: Capital expenditures
     (1,509 )     (1,479 )     (2,574 )     (3,525 )
     
Free cash flow
   $ 5,961     $ 5,891     $ 6,900     $ 7,553  
     
 
                                
Balance Sheet Data
                                
Working capital
                   $ 11,682     $ 22,936  
Net fixed assets
                     71,508       75,846  
Net intangible assets and other assets
                     113,687       228,975  
Total assets
                     223,982       344,392  
Long-term debt (including current portion of $13,428 and $1,061, respectively)
                     133,428       134,411  
Stockholders’ equity
                     68,275       151,381  

 

 

Saga Communications, Inc.
Selected Supplemental Financial Data
For the Three Months Ended
June 30, 2009 and 2008
(amounts in 000’s except per share data)
(Unaudited)
                                 
    As-Reported   Same Station
    Three Months Ended   Three Months Ended
    June 30,   June 30,
    2009   2008   2009   2008
         
Consolidated
                                
Net operating revenue
   $     31,637     $     37,342     $     31,253     $     37,342  
Station operating expense
     23,295       27,246       23,123       27,246  
Corporate general and administrative
     2,158       2,574       2,158       2,574  
Gain on asset exchange
     —       (224 )     —       (224 )
         
Operating income
     6,184       7,746     $ 5,972     $ 7,746  
Interest expense
     1,430       1,876                  
Other expense (income), net
     (28 )     7                  
Income tax expense
     2,108       2,403                  
                     
Net income
   $ 2,674     $ 3,460                  
                     
Earnings per share:
                                
Basic
   $ 0.63     $ 0.70                  
                     
Diluted
   $ 0.63     $ 0.70                  
                     
 
    As-Reported   Same Station
    Three Months Ended   Three Months Ended
    June 30,   June 30,
    2009   2008   2009   2008
         
Radio Segment
                                
Net operating revenue
   $ 27,530     $ 32,629     $ 27,146     $ 32,629  
Station operating expense
     19,694       23,398       19,522       23,398  
         
Operating income
   $ 7,836     $ 9,231     $ 7,624     $ 9,231  
         
 
    As-Reported   Same Station
    Three Months Ended   Three Months Ended
    June 30,   June 30,
    2009   2008   2009   2008
         
Television Segment
                                
Net operating revenue
   $ 4,107     $ 4,713     $ 4,107     $ 4,713  
Station operating expense
     3,601       3,848       3,601       3,848  
Gain on asset exchange
     —       (224 )     —       (224 )
         
Operating income
   $ 506     $ 1,089     $ 506     $ 1,089  
         
 
    As-Reported   Same Station
    Three Months Ended   Three Months Ended
    June 30,   June 30,
    2009   2008   2009   2008
         
Depreciation and amortization by segment
                                
Radio Segment
   $ 1,516     $ 1,591     $ 1,510     $ 1,591  
Television Segment
     664       605       664       605  
Corporate and Other
     48       53       48       53  
         
 
   $ 2,228     $ 2,249     $ 2,222     $ 2,249  
         

 

 

Saga Communications, Inc.
Selected Supplemental Financial Data
For the Six Months Ended
June 30, 2009 and 2008
(amounts in 000’s except per share data)
(Unaudited)
                                 
    As-Reported   Same Station
    Six Months Ended   Six Months Ended
    June 30,   June 30,
    2009   2008   2009   2008
             
Consolidated
                                
Net operating revenue
   $     57,761     $     68,874     $     57,189     $     68,874  
Station operating expense
     47,235       52,667       46,914       52,667  
Corporate general and administrative
     4,225       5,126       4,225       5,126  
Gain on asset exchange
     —       (224 )     —       (224 )
         
Operating income
     6,301       11,305     $ 6,050     $ 11,305  
Interest expense
     2,203       3,871                  
Other expense (income), net
     (32 )     27                  
Income tax expense
     1,818       3,037                  
                     
Net income
   $ 2,312     $ 4,370                  
                       
Earnings per share:
                                
Basic
   $ 0.55     $ 0.88                  
                       
Diluted
   $ 0.55     $ 0.88                  
                       
 
    As-Reported   Same Station
    Six Months Ended   Six Months Ended
    June 30,   June 30,
    2009   2008   2009   2008
             
Radio Segment
                                
Net operating revenue
   $ 50,227     $ 60,010     $ 49,655     $ 60,010  
Station operating expense
     40,011       45,311       39,690       45,311  
         
Operating income
   $ 10,216     $ 14,699     $ 9,965     $ 14,699  
             
 
    As-Reported   Same Station
    Six Months Ended   Six Months Ended
    June 30,   June 30,
    2009   2008   2009   2008
             
Television Segment
                                
Net operating revenue
   $ 7,534     $ 8,864     $ 7,534     $ 8,864  
Station operating expense
     7,224       7,356       7,224       7,356  
Gain on asset exchange
     —       (224 )     —       (224 )
         
Operating income
   $ 310     $ 1,732     $ 310     $ 1,732  
             
 
    As-Reported   Same Station
    Six Months Ended   Six Months Ended
    June 30,   June 30,
    2009   2008   2009   2008
             
Depreciation and amortization by segment
                                
Radio Segment
   $ 3,047     $ 3,153     $ 3,035     $ 3,153  
Television Segment
     1,330       1,000       1,330       1,000  
Corporate and Other
     109       106       109       106  
         
 
   $ 4,486     $ 4,259     $ 4,474     $ 4,259  
             

 

 

Saga Communications, Inc.
Selected Financial Data Non-GAAP Disclosures
For the Three Months Ended
June 30, 2009 and 2008
(amounts in 000’s)
(Unaudited)
Reconciliation of As-Reported (historical) information to Same Station Operating Income
                                                 
            Adjustment                     Adjustment        
    As-Reported     For Acquisitions     Same Station     As-Reported     For Acquisitions     Same Station  
    Three Months     and Dispositions     Three Months     Three Months     and Dispositions     Three Months  
    Ended     Not Included in     Ended     Ended     Not Included in     Ended  
    June 30,     Entire Comparable     June 30,     June 30,     Entire Comparable     June 30,  
    2009     Period     2009     2008     Period     2008  
                 
Consolidated
                                                
Net operating revenue
   $ 31,637     $ (384 )   $ 31,253     $ 37,342       —     $ 37,342  
Station operating expense
     23,295       (172 )     23,123       27,246       —       27,246  
Corporate general and administrative
     2,158       —       2,158       2,574       —       2,574  
Gain on asset exchange
     —       —       —       (224 )     —       (224 )
 
                                    
Operating income
   $ 6,184     $ (212 )   $ 5,972     $ 7,746       —     $ 7,746  
 
                                    
                                                 
            Adjustment                     Adjustment        
    As-Reported     For Acquisitions     Same Station     As-Reported     For Acquisitions     Same Station  
    Three Months     and Dispositions     Three Months     Three Months     and Dispositions     Three Months  
    Ended     Not Included in     Ended     Ended     Not Included in     Ended  
    June 30,     Entire Comparable     June 30,     June 30,     Entire Comparable     June 30,  
    2009     Period     2009     2008     Period     2008  
                 
Radio Segment
                                                
Net operating revenue
   $ 27,530     $ (384 )   $ 27,146     $ 32,629       —     $ 32,629  
Station operating expense
     19,694       (172 )     19,522       23,398       —       23,398  
 
                                    
Operating income
   $ 7,836     $ (212 )   $ 7,624     $ 9,231       —     $ 9,231  
 
                                    
                                                 
            Adjustment                     Adjustment        
    As-Reported     For Acquisitions     Same Station     As-Reported     For Acquisitions     Same Station  
    Three Months     and Dispositions     Three Months     Three Months     and Dispositions     Three Months  
    Ended     Not Included in     Ended     Ended     Not Included in     Ended  
    June 30,     Entire Comparable     June 30,     June 30,     Entire Comparable     June 30,  
    2009     Period     2009     2008     Period     2008  
Television Segment
                                                
Net operating revenue
   $ 4,107       —     $ 4,107     $ 4,713       —     $ 4,713  
Station operating expense
     3,601       —       3,601       3,848       —       3,848  
Gain on asset exchange
     —       —       —       (224 )     —       (224 )
 
                                    
Operating income
   $ 506       —     $ 506     $ 1,089       —     $ 1,089  
 
                                    

 

 

Saga Communications, Inc.
Selected Financial Data Non-GAAP Disclosures
For the Six Months Ended
June 30, 2009 and 2008
(amounts in 000’s)
(Unaudited)
Reconciliation of As-Reported (historical) information to Same Station Operating Income
                                                 
            Adjustment                     Adjustment        
    As-Reported     For Acquisitions     Same Station     As-Reported     For Acquisitions     Same Station  
    Six Months     and Dispositions     Six Months     Six Months     and Dispositions     Six Months  
    Ended     Not Included in     Ended     Ended     Not Included in     Ended  
    June 30,     Entire Comparable     June 30,     June 30,     Entire Comparable     June 30,  
    2009     Period     2009     2008     Period     2008  
         
Consolidated
                                                
Net operating revenue
   $ 57,761     $ (572 )   $ 57,189     $ 68,874       —     $ 68,874  
Station operating expense
     47,235       (321 )     46,914       52,667       —       52,667  
Corporate general and administrative
     4,225       —       4,225       5,126       —       5,126  
Gain on asset exchange
     —       —       —       (224 )     —       (224 )
 
                                    
Operating income
   $ 6,301     $ (251 )   $ 6,050     $ 11,305       —     $ 11,305  
 
                                    
                                                 
            Adjustment                     Adjustment        
    As-Reported     For Acquisitions     Same Station     As-Reported     For Acquisitions     Same Station  
    Six Months     and Dispositions     Six Months     Six Months     and Dispositions     Six Months  
    Ended     Not Included in     Ended     Ended     Not Included in     Ended  
    June 30,     Entire Comparable     June 30,     June 30,     Entire Comparable     June 30,  
    2009     Period     2009     2008     Period     2008  
         
Radio Segment
                                                
Net operating revenue
   $ 50,227     $ (572 )   $ 49,655     $ 60,010       —     $ 60,010  
Station operating expense
     40,011       (321 )     39,690       45,311       —       45,311  
 
                                    
Operating income
   $ 10,216     $ (251 )   $ 9,965     $ 14,699       —     $ 14,699  
 
                                    
                                                 
            Adjustment                     Adjustment        
    As-Reported     For Acquisitions     Same Station     As-Reported     For Acquisitions     Same Station  
    Six Months     and Dispositions     Six Months     Six Months     and Dispositions     Six Months  
    Ended     Not Included in     Ended     Ended     Not Included in     Ended  
    June 30,     Entire Comparable     June 30,     June 30,     Entire Comparable     June 30,  
    2009     Period     2009     2008     Period     2008  
         
Television Segment
                                                
Net operating revenue
   $ 7,534       —     $ 7,534     $ 8,864       —     $ 8,864  
Station operating expense
     7,224       —       7,224       7,356       —       7,356  
Gain on asset exchange
     —       —       —       (224 )     —       (224 )
 
                                    
Operating income
   $ 310       —     $ 310     $ 1,732       —     $ 1,732