Beasley Broadcast Group, Inc. (Nasdaq: BBGI) (“Beasley” or
the “Company”), a multi-platform media company, today announced
operating results for the three- and nine-month periods ended
September 30, 2022.
Summary of Third Quarter and Year-to-Date
Results
In millions, except per share data |
Three Months EndedSeptember
30, |
Nine Months EndedSeptember
30, |
|
|
2022 |
|
2021 |
|
|
2022 |
|
|
2021 |
|
Net revenue |
$63.8 |
$62.9 |
|
$184.4 |
|
$170.7 |
|
Operating income (loss)1 |
|
4.7 |
|
4.9 |
|
|
(2.6) |
|
|
8.1 |
|
Net income (loss)1 |
|
0.5 |
|
(1.6) |
|
|
(17.5) |
|
|
(12.1) |
|
Net income (loss) per diluted share1 |
$0.02 |
($0.06 |
) |
($0.60 |
) |
($0.41 |
) |
Station operating income (SOI - non-GAAP) |
|
12.3 |
|
11.7 |
|
|
29.2 |
|
|
28.0 |
|
1Operating loss and net loss per diluted share reflect a $10.5
million non-cash impairment loss in the nine months ended September
30, 2022. Net loss per diluted share reflect a $5.0 million loss on
extinguishment of long-term debt in the nine months ended September
30, 2021.
Net revenue during the three months ended
September 30, 2022 increased 1.5% to $63.8 million, primarily
reflecting a year-over-year increase in digital revenue, political
and other revenue, partially offset by a slight decrease in audio
revenue related to softness in the national agency business.
Beasley reported operating income of $4.7
million in the third quarter of 2022 compared to $4.9 million in
the third quarter of 2021, this slight decrease was driven by a
$1.2 million increase in corporate expenses related to investments
in our digital business as well as severance expense, partially
offset by a year-over-year increase in Station Operating Income
(SOI, a non-GAAP financial measure).
Third quarter 2022 interest expense decreased
5.7% to $6.6 million compared to interest expense of $7.0 million
in the prior year period, due to Beasley’s repurchase of its senior
secured notes over the past two quarters.
Beasley reported net income of $0.5 million, or
$0.02 per diluted share, in the three months ended September 30,
2022, compared to a net loss of $1.6 million, or $0.06 per diluted
share, in the three months ended September 30, 2021.
SOI increased by 5.1% to $12.3 million in the
third quarter of 2022, up from $11.7 million in the third quarter
of 2021. The increase is primarily attributable to higher net
revenue, which more than offset higher operating expenses.
Please refer to the “Calculation of SOI” and
“Reconciliation of Net Income (Loss) Attributable to BBGI
Stockholders to SOI” tables at the end of this announcement for a
discussion regarding SOI calculations.
Commenting on the financial results, Caroline
Beasley, Chief Executive Officer, said, “Beasley delivered another
strong period of operating and financial performance, reflecting
the ongoing success of our digital transformation and revenue
diversification strategies. Top-line growth was the primary factor
contributing to a 5.1% year-over-year increase in SOI to $12.3
million and was driven by continued strength in local audio
advertising and impressive growth in our digital business.
“Regarding the economic environment, like many
companies, we are managing through some challenging market
conditions with a focus on what we can control. We continue to
experience increased volatility in national spot advertising, which
accounted for approximately 15% of our third quarter net revenues.
The ongoing strength of our digital and local audio advertising
revenues is helping us to partially offset these declines. We are
also taking actions on the expense side, and have implemented
approximately $10.0 million in expense reductions, of which roughly
half were from a reduction to headcount.
“Digital remains a key component of our revenue
diversification strategy. Digital revenue increased 23.1%
year-over-year representing 16.0% of total third quarter revenues,
while our digital margin improved. Our digital performance
benefitted from a first full quarter contribution from the white
label digital agency we acquired in late June, which we believe
will continue to accelerate our digital revenue growth and provide
meaningful synergies with our growing digital platform. In both the
second and third quarters, digital revenue accounted for a larger
share of our revenue than national advertising, and we expect this
revenue source to continue offsetting national spot weakness in the
coming quarters.
“Total outstanding debt as of September 30, 2022
was $290.0 million. During the quarter, we repurchased $5.0 million
aggregate principal amount of our senior secured notes for an
aggregate price equal to 77% of the principal amount and recorded
an aggregate gain of $1.0 million as a result of the repurchases.
Beasley had $32.8 million of cash and cash equivalents on hand at
quarter end. We intend to keep our cash on the balance sheet in
order to maintain our strong liquidity position, given the
uncertain economic environment.
“In summary, we believe these results
demonstrate the strength and relevance of our industry-leading
audio and digital content, as well as our teams’ extraordinary
efforts to serve our listeners, customers and communities through
challenging circumstances. And while we cannot control how the
economic situation evolves in the coming months, we have already
taken decisive steps to mitigate the impact of near-term headwinds
and drive continued progress against our long-term growth strategy.
Looking ahead, we will continue to focus on maximizing our growth
opportunities, managing our expenses and capital structure, serving
our audiences and advertisers and delivering results for our
stockholders.”
Conference Call and Webcast Information
The Company will host a conference call and
webcast today, November 7, 2022, at 10:00 a.m. ET to discuss its
financial results and operations. To access the conference call,
interested parties may dial 773-305-6853, conference ID 9182446
(domestic and international callers). Participants can also listen
to a live webcast of the call at the Company’s website at
www.bbgi.com. Please allow 15 minutes to register and download and
install any necessary software. Following its completion, a replay
of the webcast can be accessed for five days on the Company’s
website, www.bbgi.com.
Questions from analysts, institutional investors
and debt holders may be e-mailed to ir@bbgi.com at any time up
until 9:00 a.m. ET on Monday, November 7, 2022. Management will
answer as many questions as possible during the conference call and
webcast (provided the questions are not addressed in their prepared
remarks).
About Beasley Broadcast
GroupCelebrating its 61st anniversary this year, Beasley
Broadcast Group, Inc., (www.bbgi.com) was founded in 1961 by George
G. Beasley. Beasley Broadcast Group owns and operates 61 AM and FM
stations in 14 large- and mid-size markets in the United States.
Beasley radio stations reach approximately 20 million unique
consumers weekly over-the-air, online and on smartphones and
tablets, and millions regularly engage with the Company’s brands
and personalities through digital platforms such as Facebook,
Twitter, text, apps and email. For more information, please visit
www.bbgi.com.
For further information, or to receive future
Beasley Broadcast Group news announcements via e-mail, please
contact Beasley Broadcast Group, at 239-263-5000 or email@bbgi.com,
or Joseph Jaffoni, JCIR, at 212-835-8500 or bbgi@jcir.com.
DefinitionsStation Operating
Income (SOI) consists of net revenue less station operating
expenses. We define station operating expenses as cost of services
and selling, general and administrative expenses.
SOI is a measure widely used in the radio
broadcast industry. The Company recognizes that because SOI is not
calculated in accordance with GAAP, it is not necessarily
comparable to similarly titled measures employed by other
companies. However, management believes that SOI provides
meaningful information to investors because it is an important
measure of how effectively we operate our business (i.e., operate
radio stations) and assists investors in comparing our operating
performance with that of other radio companies.
Note Regarding Forward-Looking
StatementsStatements in this release that are
“forward-looking statements” are based upon current expectations
and assumptions, and involve certain risks and uncertainties within
the meaning of the U.S. Private Securities Litigation Reform Act of
1995. Words or expressions such as “looking ahead,” “intends,”
“believes,” “expects,” “seek,” “will,” “should,” or variations of
such words and similar expressions are intended to identify such
forward-looking statements. Forward-looking statements by their
nature address matters that are, to different degrees, uncertain.
Key risks are described in the Company’s reports filed with the
Securities and Exchange Commission (“SEC”) including its annual
report on Form 10-K and quarterly reports on Form 10-Q. Readers
should note that forward-looking statements are subject to change
and to inherent risks and uncertainties and may be impacted by
several factors, including:
- the effects of the COVID-19
pandemic, including its potential effects on the economic
environment and our results of operations, liquidity and financial
condition, and the increased risk of impairments of our FCC
licenses and/or goodwill;
- external economic forces that could
have a material adverse impact on our advertising revenues and
results of operations;
- the ability of our radio stations
to compete effectively in their respective markets for advertising
revenues;
- our ability to develop compelling
and differentiated digital content, products and services;
- audience acceptance of our content,
particularly our radio programs;
- our ability to respond to changes
in technology, standards and services that affect the radio
industry;
- our dependence on federally issued
licenses subject to extensive federal regulation;
- actions by the FCC or new
legislation affecting the radio industry;
- increases to royalties we pay to
copyright owners or the adoption of legislation requiring royalties
to be paid to record labels and recording artists;
- our dependence on selected market
clusters of radio stations for a material portion of our net
revenue;
- credit risk on our accounts
receivable;
- the risk that our FCC licenses
and/or goodwill could become impaired;
- our substantial debt levels and the
potential effect of restrictive debt covenants on our operational
flexibility and ability to pay dividends;
- the potential effects of hurricanes
on our corporate offices and radio stations;
- the failure or destruction of the
internet, satellite systems and transmitter facilities that we
depend upon to distribute our programming;
- disruptions or security breaches of
our information technology infrastructure;
- the loss of key personnel;
- our ability to integrate acquired
businesses and achieve fully the strategic and financial objectives
related thereto and their impact on our financial condition and
results of operations;
- the fact that our Company is
controlled by the Beasley family, which creates difficulties for
any attempt to gain control of our Company; and
- other economic, business,
competitive, and regulatory factors affecting our business,
including those set forth in our filings with the SEC.
Our actual performance and results could differ materially
because of these factors and other factors discussed in our SEC
filings, including but not limited to our annual reports on Form
10-K or quarterly reports on Form 10-Q, copies of which can be
obtained from the SEC, www.sec.gov, or our website, www.bbgi.com.
All information in this release is as of November 7, 2022, and we
undertake no obligation to update the information contained herein
to actual results or changes to our expectations.
-tables follow-
BEASLEY BROADCAST GROUP,
INC.Consolidated Statements of Operations (Unaudited)
|
Three months endedSeptember
30, |
|
Nine months endedSeptember
30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net revenue |
$ |
63,823,288 |
|
|
$ |
62,902,935 |
|
|
$ |
184,354,006 |
|
|
$ |
170,689,680 |
|
Operating expenses: |
|
|
|
|
|
|
|
Operating expenses (including stock-based compensation and
excluding depreciation and amortization shown separately
below) |
|
51,511,699 |
|
|
|
51,186,064 |
|
|
|
155,147,840 |
|
|
|
142,648,355 |
|
Corporate expenses (including stock-based compensation) |
|
5,132,362 |
|
|
|
3,980,815 |
|
|
|
13,933,292 |
|
|
|
11,843,958 |
|
Depreciation and amortization |
|
2,456,646 |
|
|
|
2,843,350 |
|
|
|
7,423,648 |
|
|
|
8,646,174 |
|
Impairment losses |
|
- |
|
|
|
- |
|
|
|
10,476,323 |
|
|
|
- |
|
Gain on disposition |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(191,988 |
) |
Other operating income, net |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(400,000 |
) |
Total operating expenses |
|
59,100,707 |
|
|
|
58,010,229 |
|
|
|
186,981,103 |
|
|
|
162,546,499 |
|
Operating income (loss) |
|
4,722,581 |
|
|
|
4,892,706 |
|
|
|
(2,627,097 |
) |
|
|
8,143,181 |
|
Non-operating income
(expense): |
|
|
|
|
|
|
|
Interest expense |
|
(6,621,540 |
) |
|
|
(7,021,577 |
) |
|
|
(20,293,794 |
) |
|
|
(19,665,017 |
) |
Loss on extinguishment of long-term debt |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(4,996,731 |
) |
Other income, net |
|
1,166,430 |
|
|
|
12,186 |
|
|
|
1,357,512 |
|
|
|
58,679 |
|
Loss before income taxes |
|
(732,529 |
) |
|
|
(2,116,685 |
) |
|
|
(21,563,379 |
) |
|
|
(16,459,888 |
) |
Income tax benefit |
|
(1,252,669 |
) |
|
|
(515,380 |
) |
|
|
(3,874,646 |
) |
|
|
(4,417,660 |
) |
Income (loss) before equity in earnings of unconsolidated
affiliates |
|
520,140 |
|
|
|
(1,601,305 |
) |
|
|
(17,688,733 |
) |
|
|
(12,042,228 |
) |
Equity in earnings of
unconsolidated affiliates, net of tax |
|
(22,072 |
) |
|
|
(19,018 |
) |
|
|
141,154 |
|
|
|
(75,042 |
) |
Net income (loss) |
|
498,068 |
|
|
|
(1,620,323 |
) |
|
|
(17,547,579 |
) |
|
|
(12,117,270 |
) |
Earnings attributable to
noncontrolling interest |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
129,249 |
|
Net income (loss) attributable to BBGI stockholders |
$ |
498,068 |
|
|
$ |
(1,620,323 |
) |
|
$ |
(17,547,579 |
) |
|
$ |
(11,988,021 |
) |
|
|
|
|
|
|
|
|
Basic and diluted net income
(loss) per share |
$ |
0.02 |
|
|
$ |
(0.06 |
) |
|
$ |
(0.60 |
) |
|
$ |
(0.41 |
) |
Basic common shares
outstanding |
|
29,546,324 |
|
|
|
29,254,609 |
|
|
|
29,445,998 |
|
|
|
29,263,963 |
|
Diluted common shares
outstanding |
|
29,715,361 |
|
|
|
29,254,609 |
|
|
|
29,445,998 |
|
|
|
29,263,963 |
|
|
|
|
|
|
|
|
|
Selected Balance Sheet Data -
Unaudited(in thousands)
|
September 30, |
|
|
December 31, |
|
|
2022 |
|
|
|
2021 |
|
Cash and cash equivalents |
$ |
32,849 |
|
|
$ |
51,379 |
|
Working capital |
|
45,985 |
|
|
|
67,696 |
|
Total assets |
|
744,983 |
|
|
|
762,088 |
|
Long-term debt, net of
unamortized debt issuance costs |
|
285,105 |
|
|
|
293,790 |
|
Stockholders' equity |
$ |
246,284 |
|
|
$ |
263,082 |
|
Selected Statement of Cash Flows Data –
Unaudited
|
Nine Months EndedSeptember
30, |
|
|
2022 |
|
|
|
2021 |
|
Net cash provided by (used in)
operating activities |
$ |
2,291,387 |
|
|
$ |
(5,977,001 |
) |
Net cash used in investing
activities |
|
(12,033,625 |
) |
|
|
(342,250 |
) |
Net cash provided by (used in)
financing activities |
|
(8,787,536 |
) |
|
|
33,701,577 |
|
Net increase (decrease) in
cash and cash equivalents |
$ |
(18,529,774 |
) |
|
$ |
27,382,326 |
|
Calculation of SOI –
Unaudited
|
Three Months EndedSeptember
30, |
|
Nine Months EndedSeptember
30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net revenue |
$ |
63,823,288 |
|
|
$ |
62,902,935 |
|
|
$ |
184,354,006 |
|
|
$ |
170,689,680 |
|
Station operating
expenses |
|
(51,511,699 |
) |
|
|
(51,186,064 |
) |
|
|
(155,147,840 |
) |
|
|
(142,648,355 |
) |
SOI |
$ |
12,311,589 |
|
|
$ |
11,716,871 |
|
|
$ |
29,206,166 |
|
|
$ |
28,041,325 |
|
Reconciliation of Net Income
(Loss) Attributable to BBGI Stockholders to SOI -
Unaudited
|
Three Months EndedSeptember
30, |
|
Nine Months EndedSeptember
30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net income (loss) attributable
to BBGI stockholders |
$ |
498,068 |
|
|
$ |
(1,620,323 |
) |
|
$ |
(17,547,579 |
) |
|
$ |
(11,988,021 |
) |
Corporate expenses |
|
5,132,362 |
|
|
|
3,980,815 |
|
|
|
13,933,292 |
|
|
|
11,843,958 |
|
Depreciation and
amortization |
|
2,456,646 |
|
|
|
2,843,350 |
|
|
|
7,423,648 |
|
|
|
8,646,174 |
|
Impairment losses |
|
- |
|
|
|
- |
|
|
|
10,476,323 |
|
|
|
- |
|
Gain on dispositions |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(191,988 |
) |
Other operating income,
net |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(400,000 |
) |
Interest expense |
|
6,621,540 |
|
|
|
7,021,577 |
|
|
|
20,293,794 |
|
|
|
19,665,017 |
|
Loss on extinguishment of
long-term debt |
|
- |
|
|
|
- |
|
|
|
- |
|
|
4,996,731 |
|
Other income, net |
|
(1,166,430 |
) |
|
|
(12,186 |
) |
|
|
(1,357,512 |
) |
|
|
(58,679 |
) |
Income tax benefit |
|
(1,252,669 |
) |
|
|
(515,380 |
) |
|
|
(3,874,646 |
) |
|
|
(4,417,660 |
) |
Equity in earnings of
unconsolidated affiliates, net of tax |
|
22,072 |
|
|
|
19,018 |
|
|
|
(141,154 |
) |
|
|
75,042 |
|
Earnings attributable to
noncontrolling interest |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(129,249 |
) |
SOI |
$ |
12,311,589 |
|
|
$ |
11,716,871 |
|
|
$ |
29,206,166 |
|
|
$ |
28,041,325 |
|
CONTACT: |
|
B. Caroline
Beasley |
Joseph
Jaffoni, Jennifer Neuman |
Chief
Executive Officer |
JCIR |
Beasley
Broadcast Group, Inc. |
212/835-8500
or bbgi@jcir.com |
239/263-5000
or ir@bbgi.com |
|
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