EX-99.1 2 b70035scexv99w1.htm EX-99.1 PRESS RELEASE DATED MAY 8, 2008 exv99w1
 

Exhibit-99.1
Saga Communications, Inc.
Reports 1st Quarter 2008 Results
Contact:
Samuel D. Bush
313/886-7070
Grosse Pointe Farms, MI — May 8, 2008 — Saga Communications, Inc. (NYSE-SGA) today reported net income increased 23.0% to $910 thousand ($.05 per fully diluted share) for the quarter ended March 31, 2008 compared to $740 thousand ($.04 per fully diluted share) for the same period in 2007. Net operating revenue for the quarter decreased $351 thousand over the comparable period in 2007 to $31.5 million. Station operating expense decreased $574 thousand to $25.4 million (station operating expense includes depreciation and amortization attributable to the stations) and operating income was approximately even with 1st quarter 2007 at $3.6 million. Gross political revenue for the quarter was $651 thousand compared to $59 thousand for the same period last year. Free cash flow increased 93.5% to $1.7 million for the quarter. On a same station basis for the year, net operating revenue decreased 2.0% to $31.2 million, operating income decreased 2.4% to $3.5 million and station operating expense decreased 3.1% to $25.2 million.
Capital expenditures in the first quarter of 2008 were $2.0 million compared to $2.4 million for the comparable period in 2007. The Company expects capital expenditures to total $9.0 million for 2008.
During the quarter ended March 31, 2008, the Company bought back 239,113 shares of stock for a total purchase price of $1.4 million. Since inception of the program and through May 6, 2008, the Company has bought back 2,267,063 shares of stock.
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 2008 and 2007 acquisitions and dispositions occurred as of January 1, 2007.
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 first quarter 2008 results conference call will be on Thursday, May 8, 2008 at 2:00 PM EDT. The dial in number for domestic calls is 888/428-4479. For international callers the number is 612/332-0903. The call can be replayed for 7 days by calling domestically 800/475-6701 or internationally 320/365-3844 and referring to access code 918955. 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 May 8, 2008 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 Months Ended
March 31, 2008 and 2007
(amounts in 000’s except per share data)
(Unaudited)
                 
    Three Months Ended
    March 31,
    2008   2007
Operating Results
                
Net operating revenue
   $ 31,532     $ 31,883  
Station operating expense
     25,421       25,995  
Corporate general and administrative
     2,552       2,316  
     
Operating income
     3,559       3,572  
Interest expense
     1,995       2,297  
Other expense, net
     20       35  
     
Income before income tax
     1,544       1,240  
Income tax expense
     634       500  
     
Net income
   $ 910     $ 740  
     
Earnings per share
                
Basic
   $ 0.05     $ 0.04  
     
Diluted
   $ 0.05     $ 0.04  
     
Weighted average common shares
     20,078       20,221  
Weighted average common shares and common shares equivalents
     20,087       20,242  
 
                
Free Cash Flow
                
Net income
   $ 910     $ 740  
Plus: Depreciation and amortization:
                
Station
     1,957       1,895  
Corporate
     53       47  
Deferred tax provision
     402       270  
Non-cash compensation
     366       286  
Other expense (income), net
     20       35  
Less: Capital expenditures
     (2,046 )     (2,414 )
     
Free cash flow
   $ 1,662     $ 859  
     
 
                
Balance Sheet Data
                
Working capital
   $ 18,838     $ 18,544  
Net fixed assets
     76,358       74,146  
Net intangible assets and other assets
     228,981       211,929  
Total assets
     338,455       318,564  
Long term debt (including current portion of $1,061 and $0, respectively)
     134,411       131,911  
Stockholders’ equity
     149,168       137,306  

 

 

Saga Communications, Inc.
Selected Supplemental Financial Data
For the Three Months Ended
March 31, 2008 and 2007
(amounts in 000’s except per share data)
(Unaudited)
                                                 
    As-Reported   Same Station   Pro Forma (1)
    Three Months Ended   Three Months Ended   Three Months Ended
    March 31,   March 31,   March 31,
    2008   2007   2008   2007   2008   2007
Consolidated
                                                
Net operating revenue
   $ 31,532     $ 31,883     $ 31,233     $ 31,883     $ 31,532     $ 32,193  
Station operating expense
     25,421       25,995       25,193       25,995       25,421       26,284  
Corporate general and administrative
     2,552       2,316       2,552       2,316       2,552       2,316  
             
Operating income
     3,559       3,572     $ 3,488     $ 3,572       3,559       3,593  
Interest expense
     1,995       2,297                       1,995       2,297  
Other expense, net
     20       35                       20       35  
Income tax expense
     634       500                       634       509  
                         
Net income
   $ 910     $ 740                     $ 910     $ 752  
                         
Earnings per share:
                                                
Basic
   $ 0.05     $ 0.04                     $ 0.05     $ 0.04  
                         
Diluted
   $ 0.05     $ 0.04                     $ 0.05     $ 0.04  
                         
                                                 
    As-Reported   Same Station   Pro Forma (1)
    Three Months Ended   Three Months Ended   Three Months Ended
    March 31,   March 31,   March 31,
    2008   2007   2008   2007   2008   2007
Radio Segment
                                                
Net operating revenue
   $ 27,381     $ 27,893     $ 27,082     $ 27,893     $ 27,381     $ 28,203  
Station operating expense
     21,913       22,513       21,685       22,513       21,913       22,802  
             
Operating income
   $ 5,468     $ 5,380     $ 5,397     $ 5,380     $ 5,468     $ 5,401  
             
                                                 
    As-Reported   Same Station   Pro Forma (1)
    Three Months Ended   Three Months Ended   Three Months Ended
    March 31,   March 31,   March 31,
    2008   2007   2008   2007   2008   2007
Television Segment
                                                
Net operating revenue
   $ 4,151     $ 3,990     $ 4,151     $ 3,990     $ 4,151     $ 3,990  
Station operating expense
     3,508       3,482       3,508       3,482       3,508       3,482  
             
Operating income
   $ 643     $ 508     $ 643     $ 508     $ 643     $ 508  
             
                                                 
    As-Reported   Same Station   Pro Forma (1)
    Three Months Ended   Three Months Ended   Three Months Ended
    March 31,   March 31,   March 31,
    2008   2007   2008   2007   2008   2007
Depreciation and amortization by segment
                                                
Radio Segment
   $ 1,562     $ 1,506     $ 1,533     $ 1,506     $ 1,562     $ 1,566  
Television Segment
     395       389       395       389       395       389  
Corporate and Other
     53       47       53       47       53       47  
             
 
   $ 2,010     $ 1,942     $ 1,981     $ 1,942     $ 2,010     $ 2,002  
             
 
(1)   Pro Forma results assume all acquisitions and dispositions in 2007 and 2008 occurred as of January 1, 2007.

 

 

Saga Communications, Inc.
Selected Supplemental Financial Data
Quarterly Proforma Information
March 31, 2008 and 2007
(amounts in 000’s except per share data)
(Unaudited)
                                         
    Pro Forma (1)     Pro Forma (1)     Pro Forma (1)     Pro Forma (1)  
    Three Months Ended     Three Months Ended     Three Months Ended     Three Months Ended  
    March 31,     June 30,     September 30,     December 31,  
    2008     2007     2007     2007     2007  
Consolidated
                                        
Net operating revenue
   $ 31,532     $ 32,193     $ 38,752     $ 36,500     $ 37,537  
Station operating expense
     25,421       26,284       27,284       26,239       27,352  
Corporate general and administrative
     2,552       2,316       2,606       2,272       2,606  
                       
Operating income
     3,559       3,593       8,862       7,989       7,579  
Interest expense
     1,995       2,297       2,281       2,283       2,093  
Other expense, net
     20       35       47       60       131  
Income tax expense
     634       509       2,686       2,315       2,222  
                       
Net income
   $ 910     $ 752     $ 3,848     $ 3,331     $ 3,133  
                       
Earnings per share:
                                        
Basic
   $ 0.05     $ 0.04     $ 0.19     $ 0.17     $ 0.16  
                       
Diluted
   $ 0.05     $ 0.04     $ 0.19     $ 0.17     $ 0.16  
                       
                                         
    Pro Forma (1)     Pro Forma (1)     Pro Forma (1)     Pro Forma (1)  
    Three Months Ended     Three Months Ended     Three Months Ended     Three Months Ended  
    March 31,     June 30,     September 30,     December 31,  
    2008     2007     2007     2007     2007  
Radio Segment
                                        
Net operating revenue
   $ 27,381     $ 28,203     $ 34,174     $ 32,186     $ 32,992  
Station operating expense
     21,913       22,802       23,723       22,756       23,738  
                       
Operating income
   $ 5,468     $ 5,401     $ 10,451     $ 9,430     $ 9,254  
                       
                                         
    Pro Forma (1)     Pro Forma (1)     Pro Forma (1)     Pro Forma (1)  
    Three Months Ended     Three Months Ended     Three Months Ended     Three Months Ended  
    March 31,     June 30,     September 30,     December 31,  
    2008     2007     2007     2007     2007  
Television Segment
                                        
Net operating revenue
   $ 4,151     $ 3,990     $ 4,578     $ 4,314     $ 4,545  
Station operating expense
     3,508       3,482       3,561       3,483       3,614  
                       
Operating income
   $ 643     $ 508     $ 1,017     $ 831     $ 931  
                       
                                         
    Pro Forma (1)     Pro Forma (1)     Pro Forma (1)     Pro Forma (1)  
    Three Months Ended     Three Months Ended     Three Months Ended     Three Months Ended  
    March 31,     June 30,     September 30,     December 31,  
    2008     2007     2007     2007     2007  
Depreciation and amortization by segment
                                        
Radio Segment
   $ 1,562     $ 1,566     $ 1,599     $ 1,660     $ 1,723  
Television Segment
     395       389       400       405       425  
Corporate and Other
     53       47       51       48       58  
                       
 
   $ 2,010     $ 2,002     $ 2,050     $ 2,113     $ 2,206  
                       
 
(1)   Pro Forma results assume all acquisitions and dispositions in 2007 and 2008 occurred as of January 1, 2007.

 

 

Saga Communications, Inc.
Selected Financial Data Non-GAAP Disclosures
For the Three Months Ended
March 31, 2008 and 2007
(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  
    March 31,     Entire Comparable     March 31,     March 31,     Entire Comparable     March 31,  
    2008     Period     2008     2007     Period     2007  
Consolidated
                                                
Net operating revenue
   $ 31,532     $ (299 )   $ 31,233     $ 31,883       —     $ 31,883  
Station operating expense
     25,421       (228 )     25,193       25,995       —       25,995  
Corporate general and administrative
     2,552       —       2,552       2,316       —       2,316  
 
                                    
Operating income
   $ 3,559     $ (71 )   $ 3,488     $ 3,572       —     $ 3,572  
 
                                    
                                                 
            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  
    March 31,     Entire Comparable     March 31,     March 31,     Entire Comparable     March 31,  
    2008     Period     2008     2007     Period     2007  
Radio Segment
                                                
Net operating revenue
   $ 27,381     $ (299 )   $ 27,082     $ 27,893       —     $ 27,893  
Station operating expense
     21,913       (228 )     21,685       22,513       —       22,513  
 
                                    
Operating income
   $ 5,468     $ (71 )   $ 5,397     $ 5,380       —     $ 5,380  
 
                                    
                                                 
            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  
    March 31,     Entire Comparable     March 31,     March 31,     Entire Comparable     March 31,  
    2008     Period     2008     2007     Period     2007  
Television Segment
                                                
Net operating revenue
   $ 4,151       —     $ 4,151     $ 3,990       —     $ 3,990  
Station operating expense
     3,508       —       3,508       3,482       —       3,482  
 
                                    
Operating income
   $ 643       —     $ 643     $ 508       —     $ 508