Saga Communications, Inc. Reports 3rd Quarter 2008 Results
Saga Communications, Inc. Reports 3rd Quarter 2008 Results
GROSSE POINTE FARMS, Mich., Nov. 4 /PRNewswire-FirstCall/ -- Saga Communications, Inc. (NYSE:SGA) today reported that 3rd quarter 2008 free cash flow was approximately flat at $5.5 million. Net operating revenue was also approximately flat with the comparable period in 2007 at $36.2 million and operating income decreased 7.2% to $7.4 million. Net income decreased $224 thousand to $3.1 million for the quarter ended September 30, 2008 ($.16 per fully diluted share compared to $.17 per fully diluted share for the comparable period in 2007). For the same period, station operating expense increased $613 thousand to $26.6 million (station operating expense includes depreciation and amortization attributable to the stations). On a same station basis for the quarter, net operating revenue decreased 1.0% to $35.9 million, operating income decreased 7.8% to $7.3 million and station operating expense increased $384 thousand to $26.3 million.
For the nine month period ended September 30, 2008, free cash flow increased 8.8% to $13.0 million. Net operating revenue decreased 1.4% from the comparable period in 2007 to $105.1 million, operating income decreased 8.0% to $18.7 million and net income decreased $404 thousand to $7.5 million ($.38 per fully diluted share) compared to $7.9 million ($.39 per fully diluted share) for the comparable period in 2007. For the same period, station operating expense increased $269 thousand to approximately $79.3 million (station operating expense includes depreciation and amortization attributable to the stations). On a same station basis for the nine months, net operating revenue decreased 2.3% to $104.1 million, operating income decreased 9.2% to $18.5 million and station operating expense decreased $452 thousand to $78.5 million.
Capital expenditures in the third quarter of 2008 were $1.6 million of which $60 thousand were as a result of acquisitions. For the nine months, capital expenditures were $5.1 million of which $390 thousand were as a result of acquisitions and $150 thousand were related to digital radio. Currently we expect capital expenditures for the year to be approximately $8.0 million (reduced from our previous estimate of $9.0 million).
During the quarter ended September 30, 2008, the Company bought back 1,548,394 shares of stock for a total purchase price of $8.8 million. For the nine month period ended September 30, 2008 the Company bought back 2,084,756 shares for a total purchase price of $11.8 million.
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 third quarter 2008 results conference call will be on Tuesday, November 4, 2008 at 2:00 PM EST. The dial in number for domestic calls is 800/230-1093. For international callers the number is 612/332-0107. The call can be replayed for 7 days by calling domestically 800/475-6701 or internationally 320/365-3844 and referring to access code 960297. 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 November 4, 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 Nine Months Ended September 30, 2008 and 2007 (amounts in 000's except per share data) (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2008 2007 2008 2007 Operating Results Net operating revenue $36,192 $36,218 $105,066 $106,522 Station operating expense 26,588 25,975 79,255 78,986 Corporate general and administrative 2,485 2,272 7,611 7,194 Gain on asset exchange (282) - (506) - Operating income 7,401 7,971 18,706 20,342 Interest expense 1,889 2,283 5,760 6,861 Other expense, net - 60 27 142 Income before income tax 5,512 5,628 12,919 13,339 Income tax expense 2,415 2,307 5,452 5,468 Net income $3,097 $3,321 $7,467 $7,871 Earnings per share Basic $0.16 $0.17 $0.38 $0.39 Diluted $0.16 $0.17 $0.38 $0.39 Weighted average common shares 18,940 20,112 19,593 20,082 Weighted average common shares and common shares equivalents 18,952 20,126 19,607 20,111 Free Cash Flow Net income $3,097 $3,321 $7,467 $7,871 Plus: Depreciation and amortization: Station 2,238 2,013 6,391 5,847 Corporate 54 48 160 146 Deferred tax provision 1,640 1,334 3,566 3,161 Non-cash compensation 338 376 1,059 991 Gain on asset exchange (282) - (506) - Other expense, net - 60 27 142 Less: Capital expenditures (1,609) (1,617) (5,134) (6,180) Free cash flow $5,476 $5,535 $13,030 $11,978 Balance Sheet Data Working capital $19,311 $22,560 Net fixed assets 73,889 74,286 Net intangible assets and other assets 230,484 217,711 Total assets 339,815 330,935 Long term debt (including current portion of $1,061 and $0, respectively) 134,411 129,911 Stockholders' equity 146,066 145,543 Saga Communications, Inc. Selected Supplemental Financial Data For The Three Months Ended September 30, 2008 and 2007 (amounts in 000's except per share data) (Unaudited) As-Reported Same Station Pro Forma (1) Three Months Three Months Three Months Ended Ended Ended September 30, September 30, September 30, 2008 2007 2008 2007 2008 2007 Consolidated Net operating revenue $36,192 $36,218 $35,855 $36,156 $36,192 $36,500 Station operating expense 26,588 25,975 26,320 25,936 26,588 26,239 Corporate general and administrative 2,485 2,272 2,485 2,272 2,485 2,272 Gain on asset exchange (282) - (282) - (282) - Operating income 7,401 7,971 $7,332 $7,948 7,401 7,989 Interest expense 1,889 2,283 1,889 2,283 Other expense, net - 60 - 60 Income tax expense 2,415 2,307 2,415 2,315 Net income $3,097 $3,321 $3,097 $3,331 Earnings per share: Basic $0.16 $0.17 $0.16 $0.17 Diluted $0.16 $0.17 $0.16 $0.17 As-Reported Same Station Pro Forma (1) Three Months Three Months Three Months Ended Ended Ended September 30, September 30, September 30, 2008 2007 2008 2007 2008 2007 Radio Segment Net operating revenue $31,306 $31,904 $30,969 $31,842 $31,306 $32,186 Station operating expense 22,717 22,492 22,449 22,453 22,717 22,756 Operating income $8,589 $9,412 $8,520 $9,389 $8,589 $9,430 As-Reported Same Station Pro Forma (1) Three Months Three Months Three Months Ended Ended Ended September 30, September 30, September 30, 2008 2007 2008 2007 2008 2007 Television Segment Net operating revenue $4,886 $4,314 $4,886 $4,314 $4,886 $4,314 Station operating expense 3,871 3,483 3,871 3,483 3,871 3,483 Gain on asset exchange (282) - (282) - (282) - Operating income $1,297 $831 $1,297 $831 $1,297 $831 As-Reported Same Station Pro Forma (1) Three Months Three Months Three Months Ended Ended Ended September 30, September 30, September 30, 2008 2007 2008 2007 2008 2007 Depreciation and amortization by segment Radio Segment $1,618 $1,608 $1,589 $1,600 $1,618 $1,660 Television Segment 620 405 620 405 620 405 Corporate and Other 54 48 54 48 54 48 $2,292 $2,061 $2,263 $2,053 $2,292 $2,113 (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 For the Nine Months Ended September 30, 2008 and 2007 (amounts in 000's except per share data) (Unaudited) As-Reported Same Station Nine Months Nine Months Ended Ended September 30, September 30, 2008 2007 2008 2007 Consolidated Net operating revenue $105,066 $106,522 $104,049 $106,460 Station operating expense 79,255 78,986 78,496 78,948 Corporate general and administrative 7,611 7,194 7,611 7,194 Gain on asset exchange (506) - (506) - Operating income 18,706 20,342 $18,448 $20,318 Interest expense 5,760 6,861 Other expense, net 27 142 Income tax expense 5,452 5,468 Net income $7,467 $7,871 Earnings per share: Basic $0.38 $0.39 Diluted $0.38 $0.39 Pro Forma (1) Nine Months Ended September 30, 2008 2007 Consolidated Net operating revenue $105,066 $107,445 Station operating expense 79,255 79,807 Corporate general and administrative 7,611 7,194 Gain on asset exchange (506) - Operating income 18,706 20,444 Interest expense 5,760 6,861 Other expense, net 27 142 Income tax expense 5,452 5,510 Net income $7,467 $7,931 Earnings per share: Basic $0.38 $0.39 Diluted $0.38 $0.39 As-Reported Same Station Pro Forma (1) Nine Months Nine Months Nine Months Ended Ended Ended September 30, September 30, September 30, 2008 2007 2008 2007 2008 2007 Radio Segment Net operating revenue $91,316 $93,640 $90,299 $93,578 $91,316 $94,563 Station operating expense 68,028 68,460 67,269 68,422 68,028 69,281 Operating income $23,288 $25,180 $23,030 $25,156 $23,288 $25,282 As-Reported Same Station Pro Forma (1) Nine Months Nine Months Nine Months Ended Ended Ended September 30, September 30, September 30, 2008 2007 2008 2007 2008 2007 Television Segment Net operating revenue $13,750 $12,882 $13,750 $12,882 $13,750 $12,882 Station operating expense 11,227 10,526 11,227 10,526 11,227 10,526 Gain on asset exchange (506) - (506) - (506) - Operating income $3,029 $2,356 $3,029 $2,356 $3,029 $2,356 As-Reported Same Station Pro Forma (1) Nine Months Nine Months Nine Months Ended Ended Ended September 30, September 30, September 30, 2008 2007 2008 2007 2008 2007 Depreciation and amortization by segment Radio Segment $4,771 $4,653 $4,685 $4,645 $4,771 $4,825 Television Segment 1,620 1,194 1,620 1,194 1,620 1,194 Corporate and Other 160 146 160 146 160 146 $6,551 $5,993 $6,465 $5,985 $6,551 $6,165 (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 September 30, 2008 and 2007 (amounts in 000's except per share data) (Unaudited) Pro Forma (1) Pro Forma (1) Three Months Three Months Ended Ended March 31, June 30, 2008 2007 2008 2007 Consolidated Net operating revenue $31,532 $32,193 $37,342 $38,752 Station operating expense 25,421 26,284 27,246 27,284 Corporate general and administrative 2,552 2,316 2,574 2,606 Gain on asset exchange - - (224) - Operating income 3,559 3,593 7,746 8,862 Interest expense 1,995 2,297 1,876 2,281 Other expense, net 20 35 7 47 Income tax expense 634 509 2,403 2,686 Net income $910 $752 $3,460 $3,848 Earnings per share: Basic $0.05 $0.04 $0.17 $0.19 Diluted $0.05 $0.04 $0.17 $0.19 Pro Forma (1) Pro Forma (1) Three Months Three Months Ended Ended September 30, December 31, 2008 2007 2007 Consolidated Net operating revenue $36,192 $36,500 $37,537 Station operating expense 26,588 26,239 27,352 Corporate general and administrative 2,485 2,272 2,606 Gain on asset exchange (282) - - Operating income 7,401 7,989 7,579 Interest expense 1,889 2,283 2,093 Other expense, net - 60 131 Income tax expense 2,415 2,315 2,222 Net income $3,097 $3,331 $3,133 Earnings per share: Basic $0.16 $0.17 $0.16 Diluted $0.16 $0.17 $0.16 Pro Forma (1) Pro Forma (1) Three Months Three Months Ended Ended March 31, June 30, 2008 2007 2008 2007 Radio Segment Net operating revenue $27,381 $28,203 $32,629 $34,174 Station operating expense 21,913 22,802 23,398 23,723 Operating income $5,468 $5,401 $9,231 $10,451 Pro Forma (1) Pro Forma (1) Three Months Three Months Ended Ended September 30, December 31, 2008 2007 2007 Radio Segment Net operating revenue $31,306 $32,186 $32,992 Station operating expense 22,717 22,756 23,738 Operating income $8,589 $9,430 $9,254 Pro Forma (1) Pro Forma (1) Three Months Three Months Ended Ended March 31, June 30, 2008 2007 2008 2007 Television Segment Net operating revenue $4,151 $3,990 $4,713 $4,578 Station operating expense 3,508 3,482 3,848 3,561 Gain on asset exchange - - (224) - Operating income $643 $508 $1,089 $1,017 Pro Forma (1) Pro Forma (1) Three Months Three Months Ended Ended September 30, December 31, 2008 2007 2007 Television Segment Net operating revenue $4,886 $4,314 $4,545 Station operating expense 3,871 3,483 3,614 Gain on asset exchange (282) - - Operating income $1,297 $831 $931 Pro Forma (1) Pro Forma (1) Three Months Three Months Ended Ended March 31, June 30, 2008 2007 2008 2007 Depreciation and amortization by segment Radio Segment $1,562 $1,566 $1,591 $1,599 Television Segment 395 389 605 400 Corporate and Other 53 47 53 51 $2,010 $2,002 $2,249 $2,050 Pro Forma (1) Pro Forma (1) Three Months Three Months Ended Ended September 30, December 31, 2008 2007 2007 Depreciation and amortization by segment Radio Segment $1,618 $1,660 $1,723 Television Segment 620 405 425 Corporate and Other 54 48 58 $2,292 $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 September 30, 2008 and 2007 (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 Sept.30, Comparable Sept.30, Sept.30, Comparable Sept.30, 2008 Period 2008 2007 Period 2007 Consolidated Net operating revenue $36,192 $(337) $35,855 $36,218 $(62) $36,156 Station operating expense 26,588 (268) 26,320 25,975 (39) 25,936 Corporate general and administrative 2,485 - 2,485 2,272 - 2,272 Gain on asset exchange (282) - (282) - - - Operating income $7,401 $(69) $7,332 $7,971 $(23) $7,948 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 Sept.30, Comparable Sept.30, Sept.30, Comparable Sept.30, 2008 Period 2008 2007 Period 2007 Radio Segment Net operating revenue $31,306 $(337) $30,969 $31,904 $(62) $31,842 Station operating expense 22,717 (268) 22,449 22,492 (39) 22,453 Operating income $8,589 $(69) $8,520 $9,412 $(23) $9,389 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 Sept.30, Comparable Sept.30, Sept.30, Comparable Sept.30, 2008 Period 2008 2007 Period 2007 Television Segment Net operating revenue $4,886 - $4,886 $4,314 - $4,314 Station operating expense 3,871 - 3,871 3,483 - 3,483 Gain on asset exchange (282) - (282) - - - Operating income $1,297 - $1,297 $831 - $831 Saga Communications, Inc. Selected Financial Data Non-GAAP Disclosures For the Nine Months Ended September 30, 2008 and 2007 (amounts in 000's) (Unaudited) Reconciliation of As-Reported (historical) information to Same Station Operating Income Adjustment For As- Acquisitions Same Reported and Station Nine Dispositions Nine Months Not Included Months Ended in Entire Ended Sept. 30, Comparable Sept. 30, 2008 Period 2008 Consolidated Net operating revenue $105,066 $(1,017) $104,049 Station operating expense 79,255 (759) 78,496 Corporate general and administrative 7,611 - 7,611 Gain on asset exchange (506) - (506) Operating income $18,706 $(258) $18,448 Adjustment For As- Acquisitions Same Reported and Station Nine Dispositions Nine Months Not Included Months Ended in Entire Ended Sept. 30, Comparable Sept. 30, 2007 Period 2007 Consolidated Net operating revenue $106,522 $(62) $106,460 Station operating expense 78,986 (38) 78,948 Corporate general and administrative 7,194 - 7,194 Gain on asset exchange - - - Operating income $20,342 $(24) $20,318 Adjustment Adjustment For For As- Acquisitions Same As- Acquisitions Same Reported and Station Reported and Station Nine Dispositions Nine Nine Dispositions Nine Months Not Included Months Months Not Included Months Ended in Entire Ended Ended in Entire Ended Sept.30, Comparable Sept.30, Sept.30, Comparable Sept.30, 2008 Period 2008 2007 Period 2007 Radio Segment Net operating revenue $91,316 $(1,017) $90,299 $93,640 $(62) $93,578 Station operating expense 68,028 (759) 67,269 68,460 (38) 68,422 Operating income $23,288 $(258) $23,030 $25,180 $(24) $25,156 Adjustment Adjustment For For As- Acquisitions Same As- Acquisitions Same Reported and Station Reported and Station Nine Dispositions Nine Nine Dispositions Nine Months Not Included Months Months Not Included Months Ended in Entire Ended Ended in Entire Ended Sept.30, Comparable Sept.30, Sept.30, Comparable Sept.30, 2008 Period 2008 2007 Period 2007 Television Segment Net operating revenue $13,750 - $13,750 $12,882 - $12,882 Station operating expense 11,227 - 11,227 10,526 - 10,526 Gain on asset exchange (506) - (506) - - - Operating income $3,029 - $3,029 $2,356 - $2,356
First Call Analyst:
FCMN Contact: aparks@sagacom.com
Source: Saga Communications, Inc.
CONTACT: Samuel D. Bush, Saga Communications, Inc., +1-313-886-7070
Web site: http://www.sagacommunications.com/
Profile: International Entertainment
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