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| 8-K - 8-K - Townsquare Media, Inc. | form8-k93017pressrelease.htm |
IMMEDIATE RELEASE
TOWNSQUARE REPORTS THIRD QUARTER 2017 RESULTS
Greenwich, CT - November 7, 2017 - Townsquare Media, Inc. (NYSE: TSQ) (“Townsquare,” the “Company,” “we,” “us,” or “our”) announced today financial results for the third quarter ended September 30, 2017.
“The highlight of Townsquare’s third quarter was, without a doubt, the strength of our Local Marketing Solutions segment, which delivered net revenue growth of 1.7%, and 3.0% excluding political revenue,” commented Bill Wilson, Co-Chief Executive Officer of Townsquare. “However, challenges in our smaller business segment, Entertainment, offset these strong results, resulting in an overall decline to net revenue, net income and Adjusted EBITDA of 1.0%, 9.9% and 11.1%, respectively. Due to these challenges, we have begun a strategic review of our Entertainment business.”
“We are very pleased with the success of our Local Marketing Solutions segment in particular the continued growth of Townsquare Interactive, our digital marketing solutions business, and Townsquare Ignite, our programmatic digital advertising platform,” commented Dhruv Prasad, Co-Chief Executive Officer of Townsquare. “Local Marketing Solutions is the core of our business, and the strength of our local products and services have allowed us to deliver consistent growth for the 15th consecutive quarter.”
In October 2017, Bill Wilson and Dhruv Prasad were appointed co-CEO’s of Townsquare, succeeding Steven Price, who is now serving as Executive Chairman. “The promotion of Bill and Dhruv to co-CEO’s was a well-planned transition, that allows for continuity and stability in our Company,” commented Steven Price. “The Board and I have great confidence in the continuing management team, and I look forward to continuing to shape our strategic direction in my new role.”
Third Quarter Highlights*
As compared to the third quarter of 2016:
•Local Marketing Solutions net revenue increased 1.7%, and 3.0% excluding political revenue
•Entertainment net revenue decreased 4.1%
•Net revenue decreased 1.0%, and 0.3% excluding political revenue
•Net income decreased 9.9%
•Adjusted EBITDA decreased 11.1%
Diluted net income per share of $0.51
Year to Date Highlights*
As compared to the first nine months of 2016:
•Local Marketing Solutions net revenue increased 2.4%, and 3.5% excluding political revenue
•Entertainment net revenue decreased 7.0%
•Net revenue decreased 1.0%, and 0.4% excluding political revenue
•Net income decreased 16.1%
•Adjusted EBITDA decreased 8.3%
Repaid $6.7 million of long-term debt
* See below for discussion of non-GAAP measures and reconciliations to GAAP measures.
Segment Reporting
We have two reportable segments, Local Marketing Solutions, which provides broadcast and digital products and solutions to advertisers and businesses within our local markets, and Entertainment, which provides live event experiences and music and lifestyle content directly to consumers, and promotion, advertising and product activations to local and national advertisers.
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Quarter Ended September 30, 2017 Compared to the Quarter Ended September 30, 2016
Net Revenue
Net revenue for the quarter ended September 30, 2017 decreased $1.6 million, or 1.0%, to $164.1 million, as compared to $165.8 million in the same period last year. Local Marketing Solutions net revenue increased $1.5 million, or 1.7%, to $90.5 million and Entertainment net revenue decreased $3.1 million, or 4.1%, to $73.6 million, due to revenue declines in certain of our live events and in our national digital business. Excluding political revenue, net revenue decreased $0.5 million, or 0.3%, to $163.9 million and Local Marketing Solutions net revenue increased $2.6 million, or 3.0%.
Net Income
Net income for the quarter ended September 30, 2017 decreased $1.6 million, or 9.9%, to $14.3 million as compared to $15.9 million in the same period last year.
Adjusted EBITDA
Adjusted EBITDA for the quarter ended September 30, 2017 decreased $5.0 million, or 11.1%, to $39.7 million as compared to $44.7 million in the same period last year.
Nine Months Ended September 30, 2017 Compared to the Nine Months Ended September 30, 2016
Net Revenue
Net revenue for the nine months ended September 30, 2017 decreased $4.2 million, or 1.0%, to $393.2 million, as compared to $397.3 million in the same period last year. Local Marketing Solutions net revenue increased $6.1 million, or 2.4%, to $257.0 million and Entertainment net revenue decreased $10.3 million, or 7.0%, to $136.2 million, in part due to revenue declines in our live events business, including the prior year sale of certain live events, in addition to revenue declines in our national digital business. Excluding political revenue and the sale of certain live events, net revenue decreased $0.4 million, or 0.1%, to $392.0 million, Local Marketing Solutions net revenue increased $8.5 million, or 3.5%, to $255.8 million and Entertainment net revenue decreased $9.0 million, or 6.2%, to $136.2 million.
Net Income
Net income for the nine months ended September 30, 2017 decreased $3.2 million, or 16.1%, to $16.8 million, as compared to $20.1 million in the same period last year.
Adjusted EBITDA
Adjusted EBITDA for the nine months ended September 30, 2017 decreased $6.8 million, or 8.3%, to $75.1 million, as compared to $81.9 million in the same period last year.
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Liquidity and Capital Resources
As of September 30, 2017, we had a total of $53.3 million of cash on hand and $50.0 million of available borrowing capacity under our revolving credit facility. As of September 30, 2017, we had $571.9 million of outstanding indebtedness, representing 5.7x and 5.2x gross and net leverage, respectively, based on Adjusted EBITDA for the twelve months ended September 30, 2017 of $100.0 million.
The table below presents a summary, as of November 7, 2017, of our outstanding common stock and securities convertible into common stock, excluding options issued under our 2014 Omnibus Incentive Plan.
Security | Number Outstanding1 | Description | |
Class A common stock | 13,819,639 | One vote per share. | |
Class B common stock | 3,022,484 | 10 votes per share.2 | |
Class C common stock | 1,636,341 | No votes.2 | |
Warrants | 8,977,676 | Each warrant is exercisable for one share of Class A common stock, at an exercise price of $0.0001 per share. The aggregate exercise price for all warrants currently outstanding is $898.3 | |
Total | 27,456,140 | ||
1 Each of the shares of common stock listed below, including the shares of Class A common stock issuable upon exercise of the warrants, has equal economic rights. | |||
2 Each share converts into 1 share of Class A common stock upon transfer or at the option of the holder, subject to certain conditions, including compliance with FCC rules. | |||
3 The warrants are fully vested and exercisable for shares of Class A common stock, subject to certain conditions, including compliance with FCC rules. | |||
Conference Call
Townsquare Media, Inc. will host a conference call to discuss certain third quarter 2017 financial results on Tuesday, November 7, 2017 at 8:00 a.m. Eastern Time. The conference call dial-in number is 1-877-407-0784 (U.S. & Canada) or 1-201-689-8560 (International) and the confirmation code is 13672538. A live webcast of the conference call will also be available on the equity investor relations page of the Company’s website at www.townsquaremedia.com.
A replay of the conference call will be available through November 14, 2017. To access the replay, please dial 1-844-512-2921 (U.S. & Canada) or 1-412-317-6671 (International) and enter confirmation code 13672538. A web-based archive of the conference call will also be available at the above website for thirty days after the call.
About Townsquare Media, Inc.
Townsquare is a radio, digital media, entertainment and digital marketing solutions company principally focused on being the premier local advertising and marketing solutions platform in small and mid-sized markets across the U.S. Our assets include 317 radio stations and more than 325 local websites in 67 U.S. markets, a digital marketing solutions company (Townsquare Interactive) serving approximately 12,000 small to medium sized businesses, a proprietary digital programmatic advertising platform (Townsquare Ignite), and approximately 550 live events with nearly 18 million attendees each year in the U.S. and Canada. Our brands include iconic local media assets such as WYRK, KLAQ, K2 and NJ101.5; acclaimed music festivals such as Mountain Jam, WE Fest and the Taste of Country Music Festival; unique touring lifestyle and entertainment events such as the America on Tap craft beer festival series and North American Midway Entertainment, North America’s largest mobile amusement company; and leading tastemaker music and entertainment owned and affiliated websites such as XXLmag.com, TasteofCountry.com, Loudwire.com and BrooklynVegan.com. For more information, please visit www.townsquaremedia.com, www.townsquareinteractive.com and www.townsquareignite.com.
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Forward-Looking Statements
Except for the historical information contained in this press release, the matters addressed are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements often discuss our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “aim,” “anticipate,” “estimate,” “expect,” “forecast,” “outlook,” “potential,” “project,” “projection,” “plan,” “intend,” “seek,” “believe,” “may,” “could,” “would,” “will,” “should,” “can,” “can have,” “likely,” the negatives thereof and other words and terms. By nature, forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statement. Forward-looking statements are based on current expectations and assumptions and currently available data and are neither predictions nor guarantees of future events or performance. You should not place undue reliance on forward-looking statements, which speak only as of the date hereof. See “Risk Factors” and “Forward-Looking Statements” included in our Annual Report on Form 10-K for the year ended December 31, 2016, filed with the Securities and Exchange Commission on or about the date hereof, for a discussion of factors that could cause our actual results to differ from those expressed or implied by forward-looking statements. Townsquare Media, Inc. assumes no responsibility to update any forward-looking statement as a result of new information, future events or otherwise, except as required by law.
Non-GAAP Financial Measures and Definitions
In this press release, we refer to Adjusted EBITDA, Adjusted EBITDA Less Interest, Capex and Taxes, Adjusted Net Income and Adjusted Net Income Per Share, which are financial measures that have not been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”).
We define Adjusted EBITDA as net income (loss) before the deduction of income taxes, other (income) expense (net), interest expense, cancellation and (repurchase) of debt, transaction costs, stock-based compensation, net (gain) loss on sale of assets, impairment of FCC licenses, impairment on investment and depreciation and amortization. Adjusted EBITDA Less Interest, Capex and Taxes is defined as Adjusted EBITDA less net cash interest expense, capital expenditures and cash paid for taxes. Adjusted Net Income is defined as net income (loss) before the deduction of income taxes, transaction costs, net (gain) loss on sale of assets and cancellation and (repurchase) of debt. Adjusted Net Income Per Share is defined as Adjusted Net Income divided by the weighted average shares outstanding. These measures do not represent, and should not be considered as alternatives to, net income (loss) or cash flows from operations, as determined under GAAP. In addition, these non-GAAP measures may not be comparable to similarly-named measures reported by other companies. Reconciliations of these non-GAAP measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are set forth in the tables below.
We use Adjusted EBITDA to facilitate company-to-company operating performance comparisons by backing out potential differences caused by variations in capital structures (affecting interest expense), taxation and the age and book depreciation of facilities and equipment (affecting relative depreciation expense), which may vary for different companies for reasons unrelated to operating performance. We use Adjusted Net Income and Adjusted Net Income Per Share to assess total company operating performance on a consistent basis. We believe that this measure, when considered together with our GAAP financial results, provides management and investors with a more complete understanding of our business operating results, including underlying trends, by excluding the effects of transaction costs, net (gain) loss on sale of assets and cancellation and (repurchase) of debt. Further, while discretionary bonuses for members of management are not determined with reference to specific targets, our Board of Directors may consider Adjusted EBITDA, Adjusted EBITDA Less Interest, Capex and Taxes, Adjusted Net Income and Adjusted Net Income Per Share when determining discretionary bonuses.
Investor Relations
Claire Yenicay
(203) 900-5555
investors@townsquaremedia.com
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TOWNSQUARE MEDIA, INC.
CONSOLIDATED BALANCE SHEETS
(in Thousands, Except Share and Per Share Data)
(unaudited)
September 30, 2017 | December 31, 2016 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash | $ | 53,299 | $ | 51,540 | |||
Accounts receivable, net of allowance of $1,658 and $1,433, respectively | 65,710 | 59,642 | |||||
Prepaid expenses and other current assets | 13,888 | 11,445 | |||||
Total current assets | 132,897 | 122,627 | |||||
Property and equipment, net | 146,524 | 139,607 | |||||
Intangible assets, net | 512,823 | 513,915 | |||||
Goodwill | 296,081 | 292,953 | |||||
Investments | 7,470 | 4,313 | |||||
Other assets | 9,128 | 7,290 | |||||
Total assets | $ | 1,104,923 | $ | 1,080,705 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 12,453 | $ | 10,602 | |||
Current portion of long-term debt | 5 | 6,901 | |||||
Deferred revenue | 14,124 | 17,213 | |||||
Accrued expenses and other current liabilities | 23,493 | 25,813 | |||||
Accrued interest | 9,172 | 4,622 | |||||
Total current liabilities | 59,247 | 65,151 | |||||
Long-term debt, less current portion (net of deferred financing costs of $7,123 and $8,006, respectively) | 564,818 | 564,315 | |||||
Deferred tax liability | 62,974 | 50,967 | |||||
Other long-term liabilities | 9,597 | 10,221 | |||||
Total liabilities | 696,636 | 690,654 | |||||
Stockholders’ equity: | |||||||
Class A common stock, par value $0.01 per share; 300,000,000 shares authorized; 13,819,639 and 13,735,690 shares issued and outstanding, respectively | 138 | 137 | |||||
Class B common stock, par value $0.01 per share; 50,000,000 shares authorized; 3,022,484 shares issued and outstanding, respectively | 30 | 30 | |||||
Class C common stock, par value $0.01 per share; 50,000,000 shares authorized; 1,636,341 shares issued and outstanding, respectively | 17 | 17 | |||||
Total common stock | 185 | 184 | |||||
Additional paid-in capital | 366,863 | 365,434 | |||||
Retained earnings | 40,759 | 24,450 | |||||
Accumulated other comprehensive loss | (415 | ) | (722 | ) | |||
Noncontrolling interest | 895 | 705 | |||||
Total stockholders’ equity | 408,287 | 390,051 | |||||
Total liabilities and stockholders’ equity | $ | 1,104,923 | $ | 1,080,705 | |||
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TOWNSQUARE MEDIA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in Thousands, Except Per Share Data)
(unaudited)
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Net revenue | $ | 164,112 | $ | 165,756 | $ | 393,192 | $ | 397,345 | |||||||
Operating costs and expenses: | |||||||||||||||
Direct operating expenses, excluding depreciation, amortization and stock-based compensation | 118,027 | 114,646 | 299,762 | 297,144 | |||||||||||
Depreciation and amortization | 6,550 | 5,686 | 19,776 | 17,812 | |||||||||||
Corporate expenses | 6,391 | 6,450 | 18,375 | 18,320 | |||||||||||
Stock-based compensation | 200 | 206 | 571 | 663 | |||||||||||
Transaction costs | 218 | 256 | 606 | 606 | |||||||||||
Net (gain) loss on sale and retirement of assets | (52 | ) | (426 | ) | 662 | 287 | |||||||||
Total operating costs and expenses | 131,334 | 126,818 | 339,752 | 334,832 | |||||||||||
Operating income | 32,778 | 38,938 | 53,440 | 62,513 | |||||||||||
Other expense (income): | |||||||||||||||
Interest expense, net | 8,230 | 8,294 | 24,474 | 25,740 | |||||||||||
Impairment on investment | — | 4,236 | — | 4,236 | |||||||||||
Repurchase of debt | — | — | — | (461 | ) | ||||||||||
Other expense (income), net | 139 | 52 | 189 | (351 | ) | ||||||||||
Income before income taxes | 24,409 | 26,356 | 28,777 | 33,349 | |||||||||||
Provision for income taxes | 10,116 | 10,493 | 11,929 | 13,269 | |||||||||||
Net income | $ | 14,293 | $ | 15,863 | $ | 16,848 | $ | 20,080 | |||||||
Net income attributable to: | |||||||||||||||
Controlling interests | $ | 14,192 | $ | 15,816 | $ | 16,309 | $ | 19,823 | |||||||
Noncontrolling interests | 101 | 47 | 539 | 257 | |||||||||||
Net income per share: | |||||||||||||||
Basic | $ | 0.77 | $ | 0.86 | $ | 0.91 | $ | 1.10 | |||||||
Diluted | $ | 0.51 | $ | 0.58 | $ | 0.60 | $ | 0.74 | |||||||
Weighted average shares outstanding: | |||||||||||||||
Basic | 18,478 | 18,395 | 18,459 | 18,208 | |||||||||||
Diluted | 27,994 | 27,372 | 28,221 | 27,280 | |||||||||||
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TOWNSQUARE MEDIA, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in Thousands)
(unaudited)
Nine Months Ended September 30, | |||||||
2017 | 2016 | ||||||
Cash flows from operating activities: | |||||||
Net income attributable to: | |||||||
Controlling interests | $ | 16,309 | $ | 19,823 | |||
Noncontrolling interests | 539 | 257 | |||||
Net income | $ | 16,848 | $ | 20,080 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 19,776 | 17,812 | |||||
Amortization of deferred financing costs | 1,232 | 1,203 | |||||
Deferred income tax expense | 11,929 | 13,269 | |||||
Provision for doubtful accounts | 1,744 | 1,083 | |||||
Stock-based compensation expense | 571 | 663 | |||||
Trade receivable, net | (7,256 | ) | (6,762 | ) | |||
Repurchase of debt | — | (461 | ) | ||||
Write-off of deferred financing costs | 83 | 338 | |||||
Impairment on investment | — | 4,236 | |||||
Net loss on sale and retirement of assets | 662 | 287 | |||||
Changes in assets and liabilities, net of acquisitions: | |||||||
Accounts receivable | (5,094 | ) | (2,668 | ) | |||
Prepaid expenses and other assets | (4,242 | ) | (2,828 | ) | |||
Accounts payable | (694 | ) | (887 | ) | |||
Accrued expenses | (5,749 | ) | (8,821 | ) | |||
Accrued interest | 4,580 | 4,293 | |||||
Other long-term liabilities | (622 | ) | (677 | ) | |||
Net cash provided by operating activities | 33,768 | 40,160 | |||||
Cash flows from investing activities: | |||||||
Purchase of property and equipment | (18,169 | ) | (16,826 | ) | |||
Payments for acquisitions, net of cash received | (5,496 | ) | (1,941 | ) | |||
Payment for investment | (807 | ) | — | ||||
Acquisition of intangibles | (150 | ) | — | ||||
Proceeds from insurance settlement | — | 451 | |||||
Proceeds from sale of assets | 282 | 1,626 | |||||
Net cash used in investing activities | (24,340 | ) | (16,690 | ) | |||
Cash flows from financing activities: | |||||||
Repayment of long-term debt | (6,662 | ) | (17,460 | ) | |||
Deferred financing costs | (432 | ) | — | ||||
Proceeds from sale of noncontrolling interest in subsidiary | — | 50 | |||||
Proceeds from exercise of employee stock options | 346 | — | |||||
Cash distributions to noncontrolling interests | (349 | ) | (138 | ) | |||
Repayments of capitalized obligations | (615 | ) | (127 | ) | |||
Net cash used in financing activities | (7,712 | ) | (17,675 | ) | |||
Net effect of foreign currency exchange rate changes | 43 | (680 | ) | ||||
Net increase in cash and restricted cash | 1,759 | 5,115 | |||||
Cash and restricted cash: | |||||||
Beginning of period | 51,540 | 33,298 | |||||
End of period | $ | 53,299 | $ | 38,413 | |||
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TOWNSQUARE MEDIA, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
(in Thousands)
(unaudited)
Nine Months Ended September 30, | |||||||
2017 | 2016 | ||||||
Supplemental Disclosure of Cash Flow Information: | |||||||
Cash payments: | |||||||
Interest | $ | 18,575 | $ | 19,881 | |||
Income taxes | 1,924 | 1,910 | |||||
Purchase obligations: | |||||||
Capital lease | $ | — | $ | 525 | |||
Equity issued in respect of acquisitions: | |||||||
Common stock, joint venture acquisition | $ | 513 | $ | — | |||
Non-cash investment: | |||||||
Investments | $ | 2,350 | $ | 3,500 | |||
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TOWNSQUARE MEDIA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS BY SEGMENT
(in Thousands)
(unaudited)
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Statement of Operations Data: | |||||||||||||||
Local Marketing Solutions net revenue | $ | 90,478 | $ | 89,003 | $ | 257,012 | $ | 250,914 | |||||||
Entertainment net revenue | 73,634 | 76,753 | 136,180 | 146,431 | |||||||||||
Net revenue | 164,112 | 165,756 | 393,192 | 397,345 | |||||||||||
Operating Costs and Expenses: | |||||||||||||||
Local Marketing Solutions direct operating expenses | 58,001 | 55,773 | 172,741 | 164,826 | |||||||||||
Entertainment direct operating expenses | 60,026 | 58,873 | 127,021 | 132,318 | |||||||||||
Direct operating expenses, excluding depreciation, amortization and stock-based compensation | 118,027 | 114,646 | 299,762 | 297,144 | |||||||||||
Depreciation and amortization | 6,550 | 5,686 | 19,776 | 17,812 | |||||||||||
Corporate expenses | 6,391 | 6,450 | 18,375 | 18,320 | |||||||||||
Stock-based compensation | 200 | 206 | 571 | 663 | |||||||||||
Transaction costs | 218 | 256 | 606 | 606 | |||||||||||
Net (gain) loss on sale and retirement of assets | (52 | ) | (426 | ) | 662 | 287 | |||||||||
Total operating costs and expenses | 131,334 | 126,818 | 339,752 | 334,832 | |||||||||||
Operating income | 32,778 | 38,938 | 53,440 | 62,513 | |||||||||||
Other expense (income): | |||||||||||||||
Interest expense, net | 8,230 | 8,294 | 24,474 | 25,740 | |||||||||||
Impairment on investment | — | 4,236 | — | 4,236 | |||||||||||
Repurchase of debt | — | — | — | (461 | ) | ||||||||||
Other expense (income), net | 139 | 52 | 189 | (351 | ) | ||||||||||
Total other expense | 8,369 | 12,582 | 24,663 | 29,164 | |||||||||||
Income before income taxes | 24,409 | 26,356 | 28,777 | 33,349 | |||||||||||
Provision for income taxes | 10,116 | 10,493 | 11,929 | 13,269 | |||||||||||
Net income | $ | 14,293 | $ | 15,863 | $ | 16,848 | $ | 20,080 | |||||||
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The following table reconciles on a GAAP basis net income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted Net Income for the three and nine months ended September 30, 2017 and 2016, respectively (dollars in thousands):
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Net income | $ | 14,293 | $ | 15,863 | $ | 16,848 | $ | 20,080 | |||||||
Provision for income taxes | 10,116 | 10,493 | 11,929 | 13,269 | |||||||||||
Income before taxes | 24,409 | 26,356 | 28,777 | 33,349 | |||||||||||
Transaction costs | 218 | 256 | 606 | 606 | |||||||||||
Impairment on investment | — | 4,236 | — | 4,236 | |||||||||||
Net (gain) loss on sale and retirement of assets | (52 | ) | (426 | ) | 662 | 287 | |||||||||
Repurchase of debt | — | — | — | (461 | ) | ||||||||||
Adjusted income before taxes | 24,575 | 30,422 | 30,045 | 38,017 | |||||||||||
Provision for income taxes | 10,184 | 12,111 | 12,454 | 15,127 | |||||||||||
Adjusted Net Income | $ | 14,391 | $ | 18,311 | $ | 17,591 | $ | 22,890 | |||||||
Adjusted Net Income Per Share: | |||||||||||||||
Basic | $ | 0.78 | $ | 1.00 | $ | 0.95 | $ | 1.26 | |||||||
Diluted | $ | 0.51 | $ | 0.67 | $ | 0.62 | $ | 0.84 | |||||||
Weighted average shares outstanding: | |||||||||||||||
Basic | 18,478 | 18,395 | 18,459 | 18,208 | |||||||||||
Diluted | 27,994 | 27,372 | 28,221 | 27,280 | |||||||||||
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The following table reconciles on a GAAP basis net income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA and Adjusted EBITDA Less Interest, Capex and Taxes for the three and nine months ended September 30, 2017 and 2016, respectively (dollars in thousands):
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Net income | $ | 14,293 | $ | 15,863 | $ | 16,848 | $ | 20,080 | |||||||
Provision for income taxes | 10,116 | 10,493 | 11,929 | 13,269 | |||||||||||
Interest expense, net | 8,230 | 8,294 | 24,474 | 25,740 | |||||||||||
Transaction costs | 218 | 256 | 606 | 606 | |||||||||||
Depreciation and amortization | 6,550 | 5,686 | 19,776 | 17,812 | |||||||||||
Stock-based compensation | 200 | 206 | 571 | 663 | |||||||||||
Impairment on investment | — | 4,236 | — | 4,236 | |||||||||||
Repurchase of debt | — | — | — | (461 | ) | ||||||||||
Other(a) | 87 | (374 | ) | 851 | (64 | ) | |||||||||
Adjusted EBITDA | 39,694 | 44,660 | 75,055 | 81,881 | |||||||||||
Net cash interest expense | (3,261 | ) | (3,308 | ) | (18,575 | ) | (19,881 | ) | |||||||
Capital expenditures | (5,817 | ) | (4,410 | ) | (18,169 | ) | (16,826 | ) | |||||||
Cash paid for taxes | (583 | ) | (1,095 | ) | (1,924 | ) | (1,910 | ) | |||||||
Adjusted EBITDA Less Interest, Capex and Taxes | $ | 30,033 | $ | 35,847 | $ | 36,387 | $ | 43,264 | |||||||
(a) Other includes net loss on sale and retirement of assets and other expense (income), net.
The following table reconciles net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA on a quarterly basis for the twelve months ended September 30, 2017 (dollars in thousands):
Quarter Ended | Twelve Months Ended | ||||||||||||||||||
December 31, 2016 | March 31, 2017 | June 30, 2017 | September 30, 2017 | September 30, 2017 | |||||||||||||||
Net income (loss) | $ | 3,211 | $ | (3,008 | ) | $ | 5,563 | $ | 14,293 | $ | 20,059 | ||||||||
Provision (benefit) for income taxes | 3,771 | (1,997 | ) | 3,810 | 10,116 | 15,700 | |||||||||||||
Interest expense, net | 8,332 | 8,254 | 7,990 | 8,230 | 32,806 | ||||||||||||||
Transaction costs | 238 | 199 | 190 | 218 | 845 | ||||||||||||||
Depreciation and amortization | 6,164 | 6,390 | 6,836 | 6,550 | 25,940 | ||||||||||||||
Stock-based compensation | 3,591 | 188 | 183 | 200 | 4,162 | ||||||||||||||
Repurchase of debt | (85 | ) | — | — | — | (85 | ) | ||||||||||||
Other(a) | (317 | ) | 31 | 732 | 87 | 533 | |||||||||||||
Adjusted EBITDA | $ | 24,905 | $ | 10,057 | $ | 25,304 | $ | 39,694 | $ | 99,960 | |||||||||
(a) Other includes net gain (loss) on sale of assets and other expense (income), net.
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Reconciliation of Net revenue to Net revenue, excluding political revenue
Three Months Ended September 30, | % | Nine Months Ended September 30, | % | ||||||||||||||||
2017 | 2016 | Change | 2017 | 2016 | Change | ||||||||||||||
Consolidated: | |||||||||||||||||||
Net revenue | $ | 164,112 | $ | 165,756 | (1.0 | )% | $ | 393,192 | $ | 397,345 | (1.0 | )% | |||||||
Less: Political revenue | 209 | 1,331 | 1,241 | 3,697 | |||||||||||||||
Net revenue, excluding political revenue | $ | 163,903 | $ | 164,425 | (0.3 | )% | $ | 391,951 | $ | 393,648 | (0.4 | )% | |||||||
Local Marketing Solutions Segment: | |||||||||||||||||||
Net revenue | $ | 90,478 | $ | 89,003 | 1.7 | % | $ | 257,012 | $ | 250,914 | 2.4 | % | |||||||
Less: Political revenue | 209 | 1,331 | 1,241 | 3,697 | |||||||||||||||
Net revenue, excluding political revenue | $ | 90,269 | $ | 87,672 | 3.0 | % | $ | 255,771 | $ | 247,217 | 3.5 | % | |||||||
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