- Total Revenue: $60.4 million, down 4.8% year-over-year.
- Same-Station Revenue: Down 2% year-over-year.
- Same-Station Digital Revenue: Up 10.2% year-over-year.
- Digital Revenue Share: 21.5% of total revenue, up from 19.4% in Q2 2023.
- Net Political Revenue: $586,000, exceeding budget by 72%.
- Same-Station National Revenue: Up 7.3% year-over-year.
- Local Spot Revenue: Down 10.9% year-over-year.
- Operating Expenses: Decreased 3.9% or $2 million year-over-year.
- Adjusted EBITDA: Increased 11.4% to $8.8 million.
- Operating Income: Increased 219% to $5.4 million.
- Interest Expense: Decreased $632,000 year-over-year to $6.1 million.
- Total Debt: $267 million, down from $300 million in 2021.
- Cash on Hand: $33.3 million, up from $27.8 million at the end of Q1 2024.
- Capital Expenditures: $1 million for the quarter.
- Consumer Services Revenue: 31.1% of total revenue, down 1% year-over-year.
- Retail Revenue: 16.2% of total revenue, down 5.4% year-over-year.
- Entertainment Revenue: Up 4.5% year-over-year, accounting for 16.1% of total revenue.
- Sports Betting Revenue: $3.1 million, accounting for 5.6% of total revenue.
- Auto Category Revenue: Down 18.5% year-over-year.
- Consumer Products Revenue: 6% of total revenue, up 19.8% year-over-year.
- Corporate G&A Expenses: Decreased 11.9% year-over-year to $3.9 million.
Release Date: August 12, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Second quarter same-station digital revenue grew by an impressive 10.2%.
- Digital revenue now accounts for 21.5% of total revenue, up from 19.4% in Q2 2023.
- Political revenue exceeded expectations, generating $586,000 in net political revenue.
- National revenue showed signs of stabilizing, with same-station national up 7.3%.
- Adjusted EBITDA increased 11.4% to $8.8 million in the second quarter.
Negative Points
- Total revenue was down 4.8% on an actual basis.
- Local spot revenue declined by 10.9%, driven by a 3% decline in local agency business and a 4.9% decline in local direct.
- Operating expenses included $1.3 million in severance costs.
- Auto category revenue was down 18.5% year-over-year.
- Interest expense remains high at $6.1 million for the quarter.
Q & A Highlights
Q: Are you in any discussions with creditors about the February 2026 bond maturity?
A: Caroline Beasley, CEO: We are laser-focused on addressing our first quarter 2026 maturity, and we will have more details to come on this near term.
Q: Are there more assets that could be sold?
A: Caroline Beasley, CEO: We are open to selling assets at an attractive and deleveraging price.
Q: Do you realize you realized $2 million of cost improvements in the quarter, how far into the $10 million cost savings program are you?
A: Marie Tedesco, CFO: As reviewed in our prepared remarks, the same-station expenses, excluding the divestiture of WJBR and Outlaws, were flattish. Adding back the one-time severance of $1.3 million and increased digital expenses from the increased digital revenue, our expenses would have dropped approximately $2.2 million. Our second quarter expense reductions occurred in May, so we did not see the full quarter benefit of the savings in the second quarter.
Q: Can you provide more details on the digital revenue growth and its future outlook?
A: Caroline Beasley, CEO: Digital revenue grew by an impressive 10.2% in Q2, now accounting for 21.5% of total revenue. For the full year 2024, we expect digital to account for between 20% and 25% of our total revenue. This growth is driven by our content creation capability and the continued success and expansion of our digital service offerings.
Q: What are the main drivers behind the overall revenue decline?
A: Marie Tedesco, CFO: The main drivers of the overall revenue decline were related to the divested Wilmington station, the elimination of the outlaws, and the decline in local spot business. This was somewhat offset by continued growth in digital and political revenue.
Q: How did the political revenue perform in Q2?
A: Caroline Beasley, CEO: During Q2, we generated $586,000 in net political revenue, exceeding our second quarter political revenue budget by 72%. This compares to $228,000 in political revenue in Q2 2020.
Q: Can you elaborate on the expense reductions and their impact?
A: Marie Tedesco, CFO: Operating expenses in the quarter declined 3.9% or $2 million, including $1.3 million in severance costs. Excluding severance costs, expenses were down $3.3 million, and SOI would have increased by $250,000 to $12.4 million.
Q: What is the outlook for the third quarter?
A: Caroline Beasley, CEO: Pacings as of today are down low to mid-single digits, with July ending up slightly and August and September pacing down. We remain optimistic about the growth prospects in the second half of 2024, driven by anticipated strong political spending and continued expansion in the digital sector.
Q: How is the company addressing its capital structure ahead of the 2026 maturity?
A: Caroline Beasley, CEO: We have developed a strategic plan focused on revenue, leverage, free cash flow, and addressing our capital structure ahead of the first quarter 2026 maturity. This includes streamlining our traditional business, expanding our digital revenue, and remaining focused on corporate expense management.
Q: What are the key areas of focus for the company's digital strategy?
A: Caroline Beasley, CEO: Our digital strategy focuses on growing and monetizing our social media audiences, connecting show pages to our social media management platform, and increasing monetizable social media followers. We also hired a head of digital content marketing to help build new digital revenue streams.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
