EX-99.1 2 k85146exv99w1.txt PRESS RELEASE, DATED MAY 4, 2004 [SAGA COMMUNICATIONS, INC. LOGO] Saga Communications, Inc. Reports 1st Quarter 2004 Results CONTACT: Samuel D. Bush 313/886-7070 Grosse Pointe Farms, MI -- May 4, 2004 -- Saga Communications, Inc. (NYSE-SGA) today reported net income of $2.5 million ($.12 per fully diluted share) for the quarter ended March 31, 2004 compared to $1.6 million ($.08 per fully diluted share) for 2003. For the quarter ended March 31, 2004, net operating revenue increased 11.6% over the comparable period in 2003 to approximately $29.2 million. Operating income increased 23.0% to approximately $5.3 million. Station operating income (net operating revenue less station operating expense) increased 18.1% to approximately $8.7 million for the quarter. On a same station basis for the quarter, net operating revenue increased 8.0% to approximately $28.2 million, operating income increased 21.0% to $5.2 million and station operating income (net operating revenue less station operating expense) increased 16.1% to approximately $8.5 million. Capital expenditures in the first quarter of 2004 were approximately $2.3 million with approximately $.9 million being spent as a result of acquisitions. For the year ending 2004 total capital expenditures are expected to approximate $8.5 to $9.0 million with approximately $4.0 -- $4.5 million being spent as a result of acquisitions. The attached Selected Supplemental Financial Data table discloses "as reported," "same station" and "pro forma" 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. The "pro forma" amounts assume the 2004 and 2003 acquisitions and dispositions occurred as of January 1, 2003. Saga expects net revenue to be between $35.0 and $35.5 million and station operating expenses to be between $22.4 and $22.7 million on a pro forma basis for the second quarter of 2004. The guidance being provided is based on the economic and market conditions as of May 4, 2004. The Company can give no assurances as to whether these conditions will continue, or if they change, how such changes may affect the Company's current expectations. While Saga may from time to time issue updated guidance, it assumes no obligation to do so. Saga Communications utilizes certain financial measures that are not calculated in accordance with generally accepted accounting principles (GAAP) to access its financial performance. Such non-GAAP measures include station operating income, same station financial information, pro forma station operating income 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. Additionally, the Company announced that it has entered into an agreement to acquire the assets of WXLS-FM, which will be its fourth radio station in the environs of Champaign, IL. The assets are to be purchased for approximately $3.25 million with the closing expected to occur, subject to the approval of the Federal Communications Commission, during the 3rd quarter 2004. 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 24 markets, including 52 FM and 27 AM radio stations, 3 state radio networks, 2 farm radio networks, 5 television stations and 3 low power television stations. Additionally, Saga has entered into agreements to acquire an AM and FM serving the Asheville, NC radio market. For additional information contact us at 313/886-7070 or visit our website at www.sagacommunications.com. Saga's first quarter results conference call will be on Tuesday, May 4 at 10:00AM. The dial in number for domestic calls is 888/273-9885. For international callers the number is 612/332-0820. The call can be replayed for 7 days by calling domestically 800/475-6701 or internationally 320/365-3844 and referring to access code 728081. Thereafter, a transcript of the call will be available on our website. 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. 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 MONTH PERIODS ENDED MARCH 31, 2004 AND 2003 (AMOUNTS IN 000'S EXCEPT PER SHARE DATA) (Unaudited)
THREE MONTHS ENDED MARCH 31, ---------------------------- 2004 2003 --------- --------- OPERATING RESULTS Net operating revenue $ 29,173 $ 26,141 Station operating expense (excluding depreciation, amortization, corporate general and administrative) 20,518 18,813 --------- --------- Station operating income (*) 8,655 7,328 Corporate general and administrative 1,683 1,245 Depreciation 1,674 1,719 Amortization 42 90 --------- --------- Operating income 5,256 4,274 Interest expense 1,095 1,535 Other (income) expense 8 (8) --------- --------- Income before income tax 4,153 2,747 Income tax expense 1,622 1,098 --------- --------- Net income $ 2,531 $ 1,649 ========= ========= Earnings per share - basic and diluted $ .12 $ .08 ========= ========= Weighted average common shares 20,809 20,805 Weighted average common and common equivalent shares 21,281 21,264 FREE CASH FLOW Net income $ 2,531 $ 1,649 Plus: Depreciation and amortization 1,716 1,809 Deferred tax provision 665 439 Less: Capital expenditures (2,322) (2,521) --------- --------- Free cash flow $ 2,590 $ 1,376 ========= ========= BALANCE SHEET DATA Working capital $ 24,048 $ 1,290 Net fixed assets 63,418 60,919 Net intangible and other assets 164,094 144,910 Total assets 265,835 238,467 Long term debt (including current portion of $18 and $17,840, respectively) 121,178 114,123 Stockholders' equity 109,508 94,930
(*) Excluding depreciation, amortization, and corporate general and administrative SAGA COMMUNICATIONS, INC. SELECTED SUPPLEMENTAL FINANCIAL DATA FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003 (AMOUNTS IN 000'S EXCEPT PER SHARE DATA) (UNAUDITED)
AS-REPORTED SAME STATION PRO FORMA(1) CONSOLIDATED THREE MONTHS ENDED THREE MONTHS ENDED THREE MONTHS ENDED MARCH 31, MARCH 31, MARCH 31, 2004 2003 2004 2003 2004 2003 -------- -------- -------- -------- -------- -------- Net operating revenue $ 29,173 $ 26,141 $ 28,233 $ 26,132 $ 29,513 $ 27,382 Station operating expense 20,518 18,813 19,735 18,810 20,702 20,063 -------- -------- -------- -------- -------- -------- Station operating income (2) 8,655 7,328 8,498 7,322 8,811 7,319 Corporate general and administrative 1,683 1,245 1,683 1,245 1,683 1,245 Depreciation 1,674 1,719 1,609 1,719 1,680 1,756 Amortization 42 90 42 90 42 107 -------- -------- -------- -------- -------- -------- Operating income 5,256 4,274 $ 5,164 $ 4,268 5,406 4,211 Interest expense 1,095 1,535 1,095 1,607 Other (income) expense, net 8 (8) 8 (8) Income tax expense 1,622 1,098 1,686 1,040 -------- -------- -------- -------- Net income $ 2,531 $ 1,649 $ 2,617 $ 1,572 ======== ======== ======== ======== Earnings per share: Basic $ 0.12 $ 0.08 $ 0.13 $ 0.08 ======== ======== ======== ======== Diluted $ 0.12 $ 0.08 $ 0.12 $ 0.07 ======== ======== ======== ========
AS-REPORTED SAME STATION PRO FORMA(1) RADIO SEGMENT THREE MONTHS ENDED THREE MONTHS ENDED THREE MONTHS ENDED MARCH 31, MARCH 31, MARCH 31, 2004 2003 2004 2003 2004 2003 -------- -------- -------- -------- -------- -------- Net operating revenue $ 26,019 $ 23,525 $ 25,257 $ 23,516 $ 26,359 $ 24,766 Station operating expense 17,897 16,529 17,294 16,526 18,081 17,779 -------- -------- -------- -------- -------- -------- Station operating income (2) 8,122 6,996 7,963 6,990 8,278 6,987 Depreciation 1,214 1,281 1,149 1,281 1,220 1,318 Amortization 38 86 38 86 38 103 -------- -------- -------- -------- -------- -------- Operating income $ 6,870 $ 5,629 $ 6,776 $ 5,623 $ 7,020 $ 5,566
AS-REPORTED SAME STATION PRO FORMA(1) TELEVISION SEGMENT THREE MONTHS ENDED THREE MONTHS ENDED THREE MONTHS ENDED MARCH 31, MARCH 31, MARCH 31, 2004 2003 2004 2003 2004 2003 -------- -------- -------- -------- -------- -------- Net operating revenue $ 3,154 $ 2,616 $ 2,976 $ 2,616 $ 3,154 $ 2,616 Station operating expense 2,621 2,284 2,441 2,284 2,621 2,284 -------- -------- -------- -------- -------- -------- Station operating income (2) 533 332 535 332 533 332 Depreciation 411 388 411 388 411 388 Amortization 4 4 4 4 4 4 -------- -------- -------- -------- -------- -------- Operating income (loss) $ 118 $ (60) $ 120 $ (60) $ 118 $ (60)
(1) Pro Forma results assume all acquisitions and dispositions in 2003 and 2004 occurred as of January 1, 2003. (2) Excludes depreciation, amortization, corporate general and administrative. SAGA COMMUNICATIONS, INC. SELECTED SUPPLEMENTAL FINANCIAL DATA FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003 (AMOUNTS IN 000'S EXCEPT PER SHARE DATA) (UNAUDITED)
PRO FORMA (1) PRO FORMA (1) PRO FORMA (1) PRO FORMA (1) THREE MONTHS THREE MONTHS THREE MONTHS CONSOLIDATED THREE MONTHS ENDED ENDED ENDED ENDED MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31, 2004 2003 2003 2003 2003 -------- -------- ------------- ------------- ------------- Net operating revenue $ 29,513 $ 27,382 $ 33,539 $ 31,697 $ 33,643 Station operating expense 20,702 20,063 21,643 20,047 21,909 -------- -------- ------------- ------------- ------------- Station operating income (2) 8,811 7,319 11,896 11,650 11,734 Corporate general and administrative 1,683 1,245 1,896 1,794 1,515 Depreciation 1,680 1,756 1,712 1,598 1,600 Amortization 42 107 135 140 128 -------- -------- ------------- ------------- ------------- Operating income 5,406 4,211 8,153 8,118 8,491 Interest expense 1,095 1,607 1,229 1,154 1,006 Other (income) expense, net 8 (8) (357) 1,215 281 Income tax expense 1,686 1,040 2,780 2,324 2,708 -------- -------- ------------- ------------- ------------- Net income $ 2,617 $ 1,572 $ 4,501 $ 3,425 $ 4,496 ======== ======== ============= ============= ============= Earnings per share: Basic $ 0.13 $ 0.08 $ 0.22 $ 0.16 $ 0.22 ======== ======== ============= ============= ============= Diluted $ 0.12 $ 0.07 $ 0.21 $ 0.16 $ 0.21 ======== ======== ============= ============= =============
PRO FORMA (1) PRO FORMA (1) PRO FORMA (1) PRO FORMA (1) THREE MONTHS THREE MONTHS THREE MONTHS RADIO SEGMENT THREE MONTHS ENDED ENDED ENDED ENDED MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31, 2004 2003 2003 2003 2003 -------- -------- ------------- ------------- ------------- Net operating revenue $ 26,359 $ 24,766 $ 30,424 $ 28,634 $ 30,205 Station operating expense 18,081 17,779 19,223 17,726 19,339 -------- -------- ------------- ------------- ------------- Station operating income (2) 8,278 6,987 11,201 10,908 10,866 Depreciation 1,220 1,318 1,275 1,199 1,115 Amortization 38 103 132 136 125 -------- -------- ------------- ------------- ------------- Operating income $ 7,020 $ 5,566 $ 9,794 $ 9,573 $ 9,626
PRO FORMA (1) PRO FORMA (1) PRO FORMA (1) PRO FORMA (1) THREE MONTHS THREE MONTHS THREE MONTHS TELEVISION SEGMENT THREE MONTHS ENDED ENDED ENDED ENDED MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31, 2004 2003 2003 2003 2003 -------- -------- ------------- ------------- ------------- Net operating revenue $ 3,154 $ 2,616 $ 3,115 $ 3,063 $ 3,438 Station operating expense 2,621 2,284 2,420 2,321 2,570 -------- -------- ------------- ------------- ------------- Station operating income (2) 533 332 695 742 868 Depreciation 411 388 388 349 435 Amortization 4 4 3 4 3 -------- -------- ------------- ------------- ------------- Operating income (loss) $ 118 $ (60) $ 304 $ 389 $ 430
(1) Pro Forma results assume all acquisitions and dispositions in 2003 and 2004 occurred as of January 1, 2003. (2) Excludes depreciation, amortization, corporate general and administrative. SAGA COMMUNICATIONS, INC. SELECTED FINANCIAL DATA NON-GAAP DISCLOSURES FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003 (AMOUNTS IN 000'S EXCEPT PER SHARE DATA) (UNAUDITED) RECONCILIATION OF STATION OPERATING INCOME TO GAAP OPERATING INCOME (LOSS)
AS-REPORTED SAME STATION PRO FORMA(1) CONSOLIDATED THREE MONTHS ENDED THREE MONTHS ENDED THREE MONTHS ENDED MARCH 31, MARCH 31, MARCH 31, 2004 2003 2004 2003 2004 2003 -------- -------- -------- -------- -------- -------- Operating income as reported $ 5,256 $ 4,274 $ 5,164 $ 4,268 $ 5,406 $ 4,211 Corporate general and administrative 1,683 1,245 1,683 1,245 1,683 1,245 Depreciation 1,674 1,719 1,609 1,719 1,680 1,756 Amortization 42 90 42 90 42 107 -------- -------- -------- -------- -------- -------- Station operating income $ 8,655 $ 7,328 $ 8,498 $ 7,322 $ 8,811 $ 7,319 ======== ======== ======== ======== ======== ========
AS-REPORTED SAME STATION PRO FORMA(1) RADIO SEGMENT THREE MONTHS ENDED THREE MONTHS ENDED THREE MONTHS ENDED MARCH 31, MARCH 31, MARCH 31, 2004 2003 2004 2003 2004 2003 -------- -------- -------- -------- -------- -------- Operating income as reported $ 6,870 $ 5,629 $ 6,776 $ 5,623 $ 7,020 $ 5,566 Corporate general and administrative -- -- -- -- -- -- Depreciation 1,214 1,281 1,149 1,281 1,220 1,318 Amortization 38 86 38 86 38 103 -------- -------- -------- -------- -------- -------- Station operating income $ 8,122 $ 6,996 $ 7,963 $ 6,990 $ 8,278 $ 6,987 ======== ======== ======== ======== ======== ========
AS-REPORTED SAME STATION PRO FORMA(1) TELEVISION SEGMENT THREE MONTHS ENDED THREE MONTHS ENDED THREE MONTHS ENDED MARCH 31, MARCH 31, MARCH 31, 2004 2003 2004 2003 2004 2003 -------- -------- -------- -------- -------- -------- Operating income (loss) as reported $ 118 $ (60) $ 120 $ (60) $ 118 $ (60) Corporate general and administrative -- -- -- -- -- -- Depreciation 411 388 411 388 411 388 Amortization 4 4 4 4 4 4 -------- -------- -------- -------- -------- -------- Station operating income $ 533 $ 332 $ 535 $ 332 $ 533 $ 332 ======== ======== ======== ======== ======== ========
(1) Pro Forma results assume all acquisitions and dispositions in 2003 and 2004 occurred as of January 1, 2003. SAGA COMMUNICATIONS, INC. SELECTED FINANCIAL DATA NON-GAAP DISCLOSURES FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003 (AMOUNTS IN 000'S EXCEPT PER SHARE DATA) (UNAUDITED) RECONCILIATION OF PRO FORMA STATION OPERATING INCOME TO GAAP PRO FORMA OPERATING INCOME (LOSS)
PRO FORMA (1) PRO FORMA (1) PRO FORMA (1) PRO FORMA (1) THREE MONTHS THREE MONTHS THREE MONTHS CONSOLIDATED THREE MONTHS ENDED ENDED ENDED ENDED MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31, 2004 2003 2003 2003 2003 -------- -------- ------------- ------------- ------------- Pro forma operating income as reported $ 5,406 $ 4,211 $ 8,153 $ 8,118 $ 8,491 Corporate general and administrative 1,683 1,245 1,896 1,794 1,515 Depreciation 1,680 1,756 1,712 1,598 1,600 Amortization 42 107 135 140 128 -------- -------- ------------- ------------- ------------- Pro forma station operating income $ 8,811 $ 7,319 $ 11,896 $ 11,650 $ 11,734 ======== ======== ============= ============= =============
PRO FORMA (1) PRO FORMA (1) PRO FORMA (1) PRO FORMA (1) THREE MONTHS THREE MONTHS THREE MONTHS RADIO SEGMENT THREE MONTHS ENDED ENDED ENDED ENDED MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31, 2004 2003 2003 2003 2003 -------- -------- ------------- ------------- ------------- Pro forma operating income as reported $ 7,020 $ 5,566 $ 9,794 $ 9,573 $ 9,626 Corporate general and administrative -- -- -- -- -- Depreciation 1,220 1,318 1,275 1,199 1,115 Amortization 38 103 132 136 125 -------- -------- ------------- ------------- ------------- Pro forma station operating income $ 8,278 $ 6,987 $ 11,201 $ 10,908 $ 10,866 ======== ======== ============= ============= =============
PRO FORMA (1) PRO FORMA (1) PRO FORMA (1) PRO FORMA (1) THREE MONTHS THREE MONTHS THREE MONTHS TELEVISION SEGMENT THREE MONTHS ENDED ENDED ENDED ENDED MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31, 2004 2003 2003 2003 2003 -------- -------- ------------- ------------- ------------- Pro forma operating income (loss) as reported $ 118 $ (60) $ 304 $ 389 $ 430 Corporate general and administrative -- -- -- -- -- Depreciation 411 388 388 349 435 Amortization 4 4 3 4 3 -------- -------- ------------- ------------- ------------- Pro forma station operating income $ 533 $ 332 $ 695 $ 742 $ 868 ======== ======== ============= ============= =============
(1) Pro Forma results assume all acquisitions and dispositions in 2003 and 2004 occurred as of January 1, 2003. SAGA COMMUNICATIONS, INC. SELECTED FINANCIAL DATA NON-GAAP DISCLOSURES FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003 (AMOUNTS IN 000'S EXCEPT PER SHARE DATA) (UNAUDITED) RECONCILIATION OF SAME STATION STATION OPERATING INCOME TO GAAP OPERATING INCOME (LOSS)
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 CONSOLIDATED ENDED NOT INCLUDED IN ENDED ENDED NOT INCLUDED IN ENDED MARCH 31, ENTIRE COMPARABLE MARCH 31, MARCH 31, ENTIRE COMPARABLE MARCH 31, 2004 PERIOD 2004 2003 PERIOD 2003 ------------ ----------------- ------------ ------------ ----------------- ------------ Net operating revenue $ 29,173 $ (940) $ 28,233 $ 26,141 $ (9) $ 26,132 Station operating expense 20,518 (783) 19,735 18,813 (3) 18,810 ------------ ----------------- ------------ ------------ ----------------- ------------ Station operating income (2) administrative 8,655 (157) 8,498 7,328 (6) 7,322 Corporate general and 1,683 -- 1,683 1,245 -- 1,245 Depreciation 1,674 (65) 1,609 1,719 0 1,719 Amortization 42 0 42 90 -- 90 ------------ ----------------- ----------- ------------ ----------------- ------------ Operating income (loss) $ 5,256 $ (92) $ 5,164 $ 4,274 $ (6) $ 4,268 ============ ================= =========== ============ ================= ============
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 RADIO SEGMENT ENDED NOT INCLUDED IN ENDED ENDED NOT INCLUDED IN ENDED MARCH 31, ENTIRE COMPARABLE MARCH 31, MARCH 31, ENTIRE COMPARABLE MARCH 31, 2004 PERIOD 2004 2003 PERIOD 2003 ------------ ----------------- ------------ ------------ ----------------- ------------ Net operating revenue $ 26,019 $ (762) $ 25,257 $ 23,525 $ (9) $ 23,516 Station operating expense 17,897 (603) 17,294 16,529 (3) 16,526 ------------ ----------------- ----------- ------------ ----------------- ------------ Station operating income (2) 8,122 (159) 7,963 6,996 (6) 6,990 Corporate general and administrative -- -- -- -- -- -- Depreciation 1,214 (65) 1,149 1,281 0 1,281 Amortization 38 0 38 86 -- 86 ------------ ----------------- ----------- ------------ ----------------- ------------ Operating income (loss) $ 6,870 $ (94) $ 6,776 $ 5,629 $ (6) $ 5,623 ============ ================= =========== ============ ================= ============
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 TELEVISION SEGMENT ENDED NOT INCLUDED IN ENDED ENDED NOT INCLUDED IN ENDED MARCH 31, ENTIRE COMPARABLE MARCH 31, MARCH 31, ENTIRE COMPARABLE MARCH 31, 2004 PERIOD 2004 2003 PERIOD 2003 ------------ ----------------- ------------ ------------ ----------------- ------------ Net operating revenue $ 3,154 $ (178) $ 2,976 $ 2,616 $ 0 $ 2,616 Station operating expense 2,621 (180) 2,441 2,284 0 2,284 ------------ ----------------- ------------ ------------ ----------------- ------------ Station operating income (2) 533 2 535 332 -- 332 Corporate general and administrative -- -- -- -- -- -- Depreciation 411 -- 411 388 -- 388 Amortization 4 -- 4 4 -- 4 ------------ ----------------- ----------- ------------ ----------------- ------------ Operating income (loss) $ 118 $ 2 $ 120 $ (60) $ 0 $ (60) ============ ================= =========== ============ ================= ============
(2) Excludes depreciation, amortization, corporate general and administrative.