Saga Communications, Inc. Reports 4th Quarter and Year End 2007 Results

Saga Communications, Inc. Reports 4th Quarter and Year End 2007 Results

GROSSE POINTE FARMS, Mich., Feb. 28 /PRNewswire-FirstCall/ -- Saga Communications, Inc. (NYSE:SGA) today reported net operating revenue for the year ended December 31, 2007 increased 0.8% over the comparable period in 2006 to $144.0 million. The Company reported $3.5 million of net political revenue during the year ended December 31, 2006 compared to $1.4 million for the same period in 2007. Excluding political revenue, the Company's net operating revenue increased 2.3% for the period. Station operating expense increased 1.8% to $106.3 million (station operating expense includes depreciation and amortization attributable to the stations) and operating income decreased 6.9% to $27.9 million. Net income decreased 11.6% to $11.0 million ($.55 per fully diluted share) for the year ended December 31, 2007 compared to $12.5 million ($.61 per fully diluted share) for the same period in 2006. Free cash flow increased 0.2% to $16.1 million for the year. On a same station basis for the year, net operating revenue increased 0.1% to $143.0 million, operating income decreased 8.1% to $27.7 million and station operating expense increased 1.2% to $105.4 million.

For the quarter ended December 31, 2007 net operating revenue decreased 1.9% from the comparable period in 2006 to $37.5 million. The Company reported $2.4 million of net political revenue during the quarter ended December 31, 2006 compared to $852 thousand for the same period in 2007. Excluding political revenue, the Company's net operating revenue increased 2.4% for the period. Station operating expense decreased 0.9% to $27.3 million (station operating expense includes depreciation and amortization attributable to the stations) and operating income decreased 13.9% to $7.6 million. Net income decreased 14.7% to $3.1 million ($.16 per fully diluted share) for the quarter ended December 31, 2007 compared to $3.7 million ($.18 per fully diluted share) for 2006. Free cash flow decreased 13.2% to $4.1 million for the quarter. On a same station basis for the quarter, net operating revenue decreased 2.6% to $37.2 million, operating income decreased 14.5% to $7.5 million and station operating expense decreased 1.7% to $27.1 million.

Capital expenditures in the fourth quarter of 2007 were $3.7 million with $2.0 million being spent as a result of acquisitions, $309 thousand were related to digital radio and $147 thousand related to digital television. For the 2007 fiscal year total capital expenditures were approximately $9.9 million with approximately $3.7 million being spent as a result of acquisitions, $1.7 million related to digital radio and $147 thousand related to digital television.

Subsequent to the year ended December 31, 2007, the Company announced that its Board of Directors authorized an increase in the amount committed to its Stock Buy-Back Program from $30 million to $60 million. During the year ended 2007, the Company bought back 12,821 shares of stock for a total purchase price of $126,415. From January 1, 2008 through February 26, 2008, the Company has bought back 68,324 shares for a total purchase price of $407,918.

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 2007 and 2006 acquisitions and dispositions occurred as of January 1, 2006.

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 fourth quarter and year end 2007 results conference call will be on Thursday, February 28, 2008 at 2:00 PM EST. The dial in number for domestic calls is 800/230-1093. For international callers the number is 612/332-0802. The call can be replayed for 7 days by calling domestically 800/475-6701 or internationally 320/365-3844 and referring to access code 908881. 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 EST on February 28, 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 and Twelve Months Ended                         December 31, 2007 and 2006                  (amounts in 000's except per share data)                                (Unaudited)                                       Three Months Ended  Twelve Months Ended                                         December 31,        December 31,                                        2007     2006       2007      2006   Operating Results   Net operating revenue               $37,501  $38,219   $144,023  $142,946   Station operating expense            27,316   27,563    106,302   104,396   Corporate general and    administrative                       2,606    2,165      9,800     8,870   Other operating income                    -     (312)         -      (312)   Operating income                      7,579    8,803     27,921    29,992   Interest expense                      2,093    2,372      8,954     9,379   Other expense (income), net             131      145        273      (500)   Income before income tax              5,355    6,286     18,694    21,113   Income tax expense                    2,222    2,615      7,690     8,665   Net income                           $3,133   $3,671    $11,004   $12,448   Earnings per share      Basic                              $0.16    $0.18      $0.55     $0.61      Diluted                            $0.16    $0.18      $0.55     $0.61   Weighted average common shares       20,118   20,227     20,091    20,442   Weighted average common shares and    common shares equivalents           20,132   20,241     20,115    20,458    Free Cash Flow   Net income                           $3,133   $3,671    $11,004   $12,448   Plus: Depreciation and amortization:        Station                          2,135    2,177      7,982     7,961        Corporate                           58       50        204       194      Deferred tax provision             1,983    2,073      5,144     5,183      Non-cash compensation                375      326      1,366     1,310      Other expense (income), net          131      145        273      (500)   Less: Capital expenditures           (3,672)  (3,668)    (9,852)  (10,504)   Free cash flow                       $4,143   $4,774    $16,121   $16,092    Balance Sheet Data      Working capital                                      $24,075   $21,617      Net fixed assets                                      76,217    73,658      Net intangible assets and       other assets                                        220,045   210,044      Total assets                                         337,644   322,641      Long term debt (including current       portion of $0 and $0, respectively)                 129,911   133,911      Stockholders' equity                                 149,076   136,236                            Saga Communications, Inc.                    Selected Supplemental Financial Data                         For the Three Months Ended                         December 31, 2007 and 2006                  (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                         December 31,      December 31,      December 31,                        2007     2006     2007     2006     2007     2006   Consolidated   Net operating    revenue          $37,501  $38,219  $37,225  $38,219  $37,537  $38,582   Station operating    expense           27,316   27,563   27,091   27,563   27,352   27,864   Corporate general    and    administrative     2,606    2,165    2,606    2,165    2,606    2,165   Other operating    income                 -     (312)       -     (312)       -     (312)   Operating income    7,579    8,803   $7,528   $8,803    7,579    8,865   Interest expense    2,093    2,372                      2,093    2,372   Other expense    (income), net        131      145                        131      145   Income tax expense  2,222    2,615                      2,222    2,641   Net income         $3,133   $3,671                     $3,133   $3,707   Earnings per    share:      Basic            $0.16    $0.18                      $0.16    $0.18      Diluted          $0.16    $0.18                      $0.16    $0.18                           As-Reported       Same Station      Pro Forma (1)                     Three Months Ended Three Months Ended Three Months Ended                         December 31,      December 31,      December 31,                        2007     2006     2007     2006     2007     2006   Radio Segment   Net operating    revenue          $32,956  $33,174  $32,680  $33,174  $32,992  $33,537   Station operating    expense           23,702   23,952   23,477   23,952   23,738   24,253   Other operating    income                 -     (312)       -     (312)       -     (312)   Operating income   $9,254   $9,534   $9,203   $9,534   $9,254   $9,596                          As-Reported       Same Station       Pro Forma (1)                     Three Months Ended Three Months Ended Three Months Ended                        December 31,      December 31,      December 31,                       2007     2006     2007     2006     2007     2006   Television Segment   Net operating    revenue           $4,545   $5,045   $4,545   $5,045   $4,545   $5,045   Station operating    expense            3,614    3,611    3,614    3,611    3,614    3,611   Operating income     $931   $1,434     $931   $1,434     $931   $1,434                            As-Reported       Same Station     Pro Forma (1)                     Three Months Ended Three Months Ended Three Months Ended                          December 31,      December 31,      December 31,                         2007     2006     2007     2006     2007     2006   Depreciation and    amortization    by segment   Radio Segment       $1,710   $1,719   $1,653   $1,719   $1,723   $1,770   Television Segment     425      458      425      458      425      458   Corporate and Other     58       50       58       50       58       50                       $2,193   $2,227   $2,136   $2,227   $2,206   $2,278    (1) Pro Forma results assume all acquisitions and dispositions in 2006       and 2007 occurred as of January 1, 2006.                            Saga Communications, Inc.                    Selected Supplemental Financial Data                        For the Twelve Months Ended                         December 31, 2007 and 2006                  (amounts in 000's except per share data)                                (Unaudited)                           As-Reported       Same Station      Pro Forma (1)                         Twelve Months      Twelve Months     Twelve Months                            Ended              Ended             Ended                          December 31,      December 31,      December 31,                         2007     2006      2007     2006      2007    2006   Consolidated   Net    operating    revenue          $144,023 $142,946  $142,948 $142,867  $144,982 $144,446   Station operating    expense            106,302  104,396   105,409  104,129   107,159  105,626   Corporate general    and    administrative      9,800    8,870     9,800    8,870     9,800    8,870   Other operating    income                  -     (312)        -     (312)        -     (312)   Operating income    27,921   29,992   $27,739  $30,180    28,023   30,262   Interest expense     8,954    9,379                        8,954    9,379   Other expense    (income), net         273     (500)                         273     (500)   Income tax expense   7,690    8,665                        7,732    8,776   Net income         $11,004  $12,448                      $11,064  $12,607   Earnings per share:      Basic             $0.55    $0.61                        $0.55    $0.62      Diluted           $0.55    $0.61                        $0.55    $0.62                            As-Reported       Same Station      Pro Forma (1)                         Twelve Months      Twelve Months     Twelve Months                            Ended              Ended             Ended                          December 31,      December 31,      December 31,                         2007     2006      2007     2006      2007    2006   Radio Segment   Net operating    revenue          $126,596 $125,274  $125,521 $125,195  $127,555 $126,774   Station operating       expense         92,162   90,627    91,269   90,360    93,019   91,857   Other operating    income                  -     (312)        -     (312)        -     (312)   Operating income   $34,434  $34,959   $34,252  $35,147   $34,536  $35,229                            As-Reported       Same Station      Pro Forma (1)                         Twelve Months      Twelve Months     Twelve Months                            Ended              Ended             Ended                          December 31,      December 31,      December 31,                         2007     2006      2007      2006     2007    2006   Television Segment   Net operating    revenue           $17,427  $17,672  $17,427   $17,672   $17,427 $17,672   Station operating    expense            14,140   13,769   14,140    13,769    14,140  13,769   Operating income    $3,287   $3,903   $3,287    $3,903    $3,287  $3,903                            As-Reported       Same Station      Pro Forma (1)                         Twelve Months      Twelve Months     Twelve Months                            Ended              Ended             Ended                          December 31,      December 31,      December 31,                         2007      2006     2007     2006     2007    2006   Depreciation and    amortization    by segment   Radio Segment       $6,363    $6,288    $6,153    $6,231  $6,548  $6,519   Television Segment   1,619     1,673     1,619     1,673   1,619   1,673   Corporate and Other    204       194       204       194     204     194                       $8,186    $8,155    $7,976    $8,098  $8,371  $8,386      (1) Pro Forma results assume all acquisitions and dispositions in 2006         and 2007 occurred as of January 1, 2006.                            Saga Communications, Inc.                    Selected Supplemental Financial Data                       Quarterly Proforma Information                         December 31, 2007 and 2006                  (amounts in 000's except per share data)                                (Unaudited)                                         Pro Forma (1)       Pro Forma (1)                                    Three Months Ended  Three Months Ended                                        March 31,           June 30,                                       2007     2006       2007     2006   Consolidated   Net operating revenue             $32,193  $31,543    $38,752  $38,131   Station operating expense          26,284   25,020     27,284   26,674   Corporate general and    administrative                     2,316    1,981      2,606    2,499   Other operating income                  -        -          -        -   Operating income                    3,593    4,542      8,862    8,958   Interest expense                    2,297    2,277      2,281    2,355   Other expense (income), net            35     (355)        47     (215)   Income tax expense                    509    1,074      2,686    2,783   Net income                           $752   $1,546     $3,848   $4,035   Earnings per share:     Basic                             $0.04    $0.08      $0.19    $0.20     Diluted                           $0.04    $0.08      $0.19    $0.20                                         Pro Forma (1)       Pro Forma (1)                                    Three Months Ended  Three Months Ended                                        March 31,           June 30,                                       2007     2006       2007     2006   Radio Segment   Net operating revenue             $28,203  $27,632    $34,174  $33,804   Station operating expense          22,802   21,732     23,723   23,265   Other operating income                  -        -          -        -   Operating income                   $5,401   $5,900    $10,451  $10,539                                         Pro Forma (1)       Pro Forma (1)                                    Three Months Ended  Three Months Ended                                        March 31,           June 30,                                       2007     2006       2007     2006   Television Segment   Net operating revenue              $3,990   $3,911     $4,578   $4,327   Station operating expense           3,482    3,288      3,561    3,409   Operating income                     $508     $623     $1,017     $918                                         Pro Forma (1)       Pro Forma (1)                                    Three Months Ended  Three Months Ended                                        March 31,           June 30,                                       2007     2006       2007     2006    Depreciation and amortization     by segment    Radio Segment                     $1,566   $1,599     $1,599   $1,596    Television Segment                   389      392        400      414    Corporate and Other                   47       48         51       48                                      $2,002   $2,039     $2,050   $2,058                                         Pro Forma (1)       Pro Forma (1)                                    Three Months Ended  Three Months Ended                                       September 30,       December 31,                                       2007     2006       2007     2006   Consolidated   Net operating revenue             $36,500  $36,190    $37,537  $38,582   Station operating expense          26,239   26,068     27,352   27,864   Corporate general and    administrative                     2,272    2,225      2,606    2,165   Other operating income                  -        -         -      (312)   Operating income                    7,989    7,897      7,579    8,865   Interest expense                    2,283    2,375      2,093    2,372   Other expense (income), net            60      (75)       131      145   Income tax expense                  2,315    2,278      2,222    2,641   Net income                         $3,331   $3,319     $3,133   $3,707   Earnings per share:     Basic                             $0.17    $0.16      $0.16    $0.18     Diluted                           $0.17    $0.16      $0.16    $0.18                                         Pro Forma (1)       Pro Forma (1)                                    Three Months Ended  Three Months Ended                                       September 30,       December 31,                                       2007     2006       2007     2006   Radio Segment   Net operating revenue             $32,186  $31,801    $32,992  $33,537   Station operating expense          22,756   22,607     23,738   24,253   Other operating income                  -        -          -     (312)   Operating income                   $9,430   $9,194     $9,254   $9,596                                         Pro Forma (1)       Pro Forma (1)                                    Three Months Ended  Three Months Ended                                       September 30,       December 31,                                       2007     2006       2007     2006   Television Segment   Net operating revenue              $4,314   $4,389     $4,545   $5,045   Station operating expense           3,483    3,461      3,614    3,611   Operating income                     $831     $928       $931   $1,434                                         Pro Forma (1)       Pro Forma (1)                                    Three Months Ended  Three Months Ended                                       September 30,       December 31,                                       2007     2006       2007     2006   Depreciation and amortization    by segment   Radio Segment                      $1,660   $1,554     $1,723   $1,770   Television Segment                    405      409        425      458   Corporate and Other                    48       48         58       50                                      $2,113   $2,011     $2,206   $2,278    (1) Pro Forma results assume all acquisitions and dispositions in 2006       and 2007 occurred as of January 1, 2006.                            Saga Communications, Inc.                Selected Financial Data Non-GAAP Disclosures                         For the Three Months Ended                         December 31, 2007 and 2006                             (amounts in 000's)                                (Unaudited)    Reconciliation of As-Reported (historical) information to Same Station    Operating Income                           Adjustment                    Adjustment                            For                           For                 As-     Acquisitions   Same    As-    Acquisitions   Same                Reported    and       Station Reported    and       Station                 Three   Dispositions  Three   Three   Dispositions  Three                Months   Not Included  Months  Months  Not Included  Months                 Ended    in Entire    Ended    Ended   in Entire    Ended                Dec. 31, Comparable   Dec. 31, Dec. 31, Comparable  Dec. 31,                 2007       Period     2007     2006       Period    2006   Consolidated   Net    operating    revenue     $37,501      $(276)   $37,225  $38,219          -   $38,219   Station    operating    expense      27,316       (225)    27,091   27,563          -    27,563   Corporate    general    and    administrat-    ive           2,606          -      2,606    2,165          -     2,165   Other    operating    income            -          -          -     (312)         -      (312)   Operating    income       $7,579       $(51)    $7,528   $8,803          -    $8,803                            Adjustment                    Adjustment                            For                           For                 As-     Acquisitions   Same    As-    Acquisitions   Same                Reported    and       Station Reported    and       Station                 Three   Dispositions  Three   Three   Dispositions  Three                Months   Not Included  Months  Months  Not Included  Months                 Ended    in Entire    Ended    Ended   in Entire    Ended                Dec. 31, Comparable   Dec. 31, Dec. 31, Comparable  Dec. 31,                 2007       Period     2007     2006       Period    2006   Radio   Segment   Net    operating    revenue     $32,956      $(276)   $32,680  $33,174          -    $33,174   Station    operating    expense      23,702       (225)    23,477   23,952          -     23,952   Other    operating    income            -          -          -     (312)         -       (312)   Operating    income       $9,254       $(51)    $9,203   $9,534          -     $9,534                            Adjustment                    Adjustment                            For                           For                 As-     Acquisitions   Same    As-    Acquisitions   Same                Reported    and       Station Reported    and       Station                 Three   Dispositions  Three   Three   Dispositions  Three                Months   Not Included  Months  Months  Not Included  Months                 Ended    in Entire    Ended    Ended   in Entire    Ended                Dec. 31, Comparable   Dec. 31, Dec. 31, Comparable  Dec. 31,                 2007       Period     2007     2006       Period    2006   Television    Segment   Net    operating    revenue      $4,545          -     $4,545   $5,045          -     $5,045   Station    operating    expense       3,614          -      3,614    3,611          -      3,611   Operating    income         $931          -       $931   $1,434          -     $1,434                            Saga Communications, Inc.                Selected Financial Data Non-GAAP Disclosures                        For the Twelve Months Ended                         December 31, 2007 and 2006                             (amounts in 000's)                                (Unaudited)    Reconciliation of As-Reported (historical) information to Same Station    Operating Income                           Adjustment                    Adjustment                            For                           For                 As-     Acquisitions   Same    As-    Acquisitions   Same                Reported    and       Station Reported    and       Station                 Twelve  Dispositions  Twelve  Twelve  Dispositions  Twelve                Months   Not Included  Months  Months  Not Included  Months                 Ended    in Entire    Ended    Ended   in Entire    Ended                Dec. 31, Comparable   Dec. 31, Dec. 31, Comparable  Dec. 31,                 2007       Period     2007     2006       Period    2006   Consolidated   Net    operating    revenue    $144,023    $(1,075)  $142,948 $142,946       $(79) $142,867   Station    operating    expense     106,302       (893)   105,409  104,396       (267)  104,129   Corporate    general    and    administrat-    ive           9,800          -       9,800   8,870          -     8,870   Other    operating    income            -          -           -    (312)         -      (312)   Operating    income      $27,921      $(182)    $27,739 $29,992       $188   $30,180                            Adjustment                    Adjustment                            For                           For                 As-     Acquisitions   Same    As-    Acquisitions   Same                Reported    and       Station Reported    and       Station                 Twelve  Dispositions  Twelve  Twelve  Dispositions  Twelve                Months   Not Included  Months  Months  Not Included  Months                 Ended    in Entire    Ended    Ended   in Entire    Ended                Dec. 31, Comparable   Dec. 31, Dec. 31, Comparable  Dec. 31,                 2007       Period     2007     2006       Period    2006   Radio Segment   Net    operating    revenue    $126,596    $(1,075)  $125,521 $125,274       $(79) $125,195   Station    operating    expense      92,162       (893)    91,269   90,627       (267)   90,360   Other    operating    income            -          -          -     (312)         -      (312)   Operating    income      $34,434      $(182)   $34,252  $34,959       $188   $35,147                            Adjustment                    Adjustment                            For                           For                 As-     Acquisitions   Same    As-    Acquisitions   Same                Reported    and       Station Reported    and       Station                 Twelve  Dispositions  Twelve  Twelve  Dispositions  Twelve                Months   Not Included  Months  Months  Not Included  Months                 Ended    in Entire    Ended    Ended   in Entire    Ended                Dec. 31, Comparable   Dec. 31, Dec. 31, Comparable  Dec. 31,                 2007       Period     2007     2006       Period    2006   Television    Segment   Net    operating    revenue     $17,427          -    $17,427  $17,672          -   $17,672   Station    operating    expense      14,140          -     14,140   13,769          -    13,769   Operating    income       $3,287          -     $3,287   $3,903          -    $3,903  

First Call Analyst:
FCMN Contact: aparks@sagacom.com

Source: Saga Communications, Inc.

CONTACT: Samuel D. Bush of Saga Communications, Inc., +1-313-886-7070

Web site: http://www.sagacommunications.com/

---

Profile: International Entertainment