2008-08-05 11:00:00
GROSSE POINTE FARMS, Mich., Aug. 5 /EMWNews/ -- Saga Communications, Inc. (NYSE: SGA) today reported that 2nd quarter 2008 free cash flow increased 5.5% to $5.9 million compared to $5.6 million for the same period last year. Net operating revenue decreased 2.8% from the comparable period in 2007 to $37.3 million and operating income decreased 12% to $7.8 million. Net income decreased $350 thousand to $3.5 million ($.17 per fully diluted share) for the quarter ended June 30, 2008 compared to $3.8 million ($.19 per fully diluted share) for the comparable period in 2007. For the same period, station operating expense increased $230 thousand to $27.3 million (station operating expense includes depreciation and amortization attributable to the stations). On a same station basis for the quarter, net operating revenue decreased 3.8% to $37.0 million, operating income decreased 13.3% to $7.6 million and station operating expense was approximately flat with last year at $27.0 million. For the six month period ended June 30, 2008, free cash flow increased 17.2% to $7.6 million. Net operating revenue decreased 2.0% from the comparable period in 2007 to $68.9 million and operating income decreased 8.6% to $11.3 million and net income decreased $180 thousand to $4.4 million ($.22 per fully diluted share) compared to $4.6 million ($.23 per fully diluted share) for the comparable period in 2007. For the same period, station operating expense decreased $344 thousand to approximately $52.7 million (station operating expense includes depreciation and amortization attributable to the stations). On a same station basis for the six months, net operating revenue decreased 3.0% to $68.2 million, operating income decreased 10.1% to $11.1 million and station operating expense decreased $827 thousand to $52.2 million. Capital expenditures in the second quarter of 2008 were $1.5 million of which $60 thousand were as a result of acquisitions. For the six months, capital expenditures were $3.5 million of which $330 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 $9.0 million. During the quarter ended June 30, 2008, the Company bought back 297,249 shares of stock for a total purchase price of $1.6 million. For the 6 month period ended June 30, 2008 the Company bought back 536,362 shares for a total purchase price of $3.0 million. Since inception of the program and through July 31, 2008, the Company has bought back 2,645,235 shares of stock. 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 http://www.sagacommunications.com. Saga's second quarter 2008 results conference call will be on Tuesday, August 5, 2008 at 2:00 PM EDT. The dial in number for domestic calls is 877/209-0397. For international callers the number is 612/332-0923. The call can be replayed for 7 days by calling domestically 800/475-6701 or internationally 320/365-3844 and referring to access code 931199. 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 EDT on August 5, 2008 to [email protected]. 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 Six Months Ended June 30, 2008 and 2007 (amounts in 000's except per share data) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2008 2007 2008 2007 Operating Results Net operating revenue $37,342 $38,421 $68,874 $70,304 Station operating expense 27,246 27,016 52,667 53,011 Corporate general and administrative 2,574 2,606 5,126 4,922 Gain on asset exchange (224) - (224) - Operating income 7,746 8,799 11,305 12,371 Interest expense 1,876 2,281 3,871 4,578 Other expense, net 7 47 27 82 Income before income tax 5,863 6,471 7,407 7,711 Income tax expense 2,403 2,661 3,037 3,161 Net income $3,460 $3,810 $4,370 $4,550 Earnings per share Basic $0.17 $0.19 $0.22 $0.23 Diluted $0.17 $0.19 $0.22 $0.23 Weighted average common shares 19,800 20,083 19,931 20,066 Weighted average common shares and common shares equivalents 19,803 20,113 19,937 20,101 Free Cash Flow Net income $3,460 $3,810 $4,370 $4,550 Plus: Depreciation and amortization: Station 2,196 1,939 4,153 3,834 Corporate 53 51 106 98 Deferred tax provision 1,524 1,557 1,926 1,827 Non-cash compensation 354 329 720 615 Gain on asset exchange (224) - (224) - Other expense, net 7 47 27 82 Less: Capital expenditures (1,479) (2,149) (3,525) (4,563) Free cash flow $5,891 $5,584 $7,553 $6,443 Balance Sheet Data Working capital $22,936 $20,886 Net fixed assets 75,846 74,308 Net intangible assets and other assets 228,975 213,427 Total assets 344,392 325,668 Long term debt (including current portion of $1,061 and $0, respectively) 134,411 129,911 Stockholders' equity 151,381 141,761 Saga Communications, Inc. Selected Supplemental Financial Data For The Three Months Ended June 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 June 30, June 30, June 30, 2008 2007 2008 2007 2008 2007 Consolidated Net operating revenue $37,342 $38,421 $36,969 $38,421 $37,342 $38,752 Station operating expense 27,246 27,016 26,991 27,016 27,246 27,284 Corporate general and administrative 2,574 2,606 2,574 2,606 2,574 2,606 Gain on asset exchange (224) - (224) - (224) - Operating income 7,746 8,799 $7,628 $8,799 7,746 8,862 Interest expense 1,876 2,281 1,876 2,281 Other expense, net 7 47 7 47 Income tax expense 2,403 2,661 2,403 2,686 Net income $3,460 $3,810 $3,460 $3,848 Earnings per share: Basic $0.17 $0.19 $0.17 $0.19 Diluted $0.17 $0.19 $0.17 $0.19 As-Reported Same Station Pro Forma (1) Three Months Three Months Three Months Ended Ended Ended June 30, June 30, June 30, 2008 2007 2008 2007 2008 2007 Radio Segment Net operating revenue $32,629 $33,843 $32,256 $33,843 $32,629 $34,174 Station operating expense 23,398 23,455 23,143 23,455 23,398 23,723 Operating income $9,231 $10,388 $9,113 $10,388 $9,231 $10,451 As-Reported Same Station Pro Forma (1) Three Months Three Months Three Months Ended Ended Ended June 30, June 30, June 30, 2008 2007 2008 2007 2008 2007 Television Segment Net operating revenue $4,713 $4,578 $4,713 $4,578 $4,713 $4,578 Station operating expense 3,848 3,561 3,848 3,561 3,848 3,561 Gain on asset exchange (224) - (224) - (224) - Operating income $1,089 $1,017 $1,089 $1,017 $1,089 $1,017 As-Reported Same Station Pro Forma (1) Three Months Three Months Three Months Ended Ended Ended June 30, June 30, June 30, 2008 2007 2008 2007 2008 2007 Depreciation and amortization by segment Radio Segment $1,591 $1,539 $1,562 $1,539 $1,591 $1,599 Television Segment 605 400 605 400 605 400 Corporate and Other 53 51 53 51 53 51 $2,249 $1,990 $2,220 $1,990 $2,249 $2,050 (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 Six Months Ended June 30, 2008 and 2007 (amounts in 000's except per share data) (Unaudited) As-Reported Same Station Pro Forma (1) Six Months Ended Six Months Ended Six Months Ended June 30, June 30, June 30, 2008 2007 2008 2007 2008 2007 Consolidated Net operating revenue $68,874 $70,304 $68,202 $70,304 $68,874 $70,945 Station operating expense 52,667 53,011 52,184 53,011 52,667 53,568 Corporate general and administrative 5,126 4,922 5,126 4,922 5,126 4,922 Gain on asset exchange (224) - (224) - (224) - Operating income 11,305 12,371 $11,116 $12,371 11,305 12,455 Interest expense 3,871 4,578 3,871 4,578 Other expense, net 27 82 27 82 Income tax expense 3,037 3,161 3,037 3,195 Net income $4,370 $4,550 $4,370 $4,600 Earnings per share: Basic $0.22 $0.23 $0.22 $0.23 Diluted $0.22 $0.23 $0.22 $0.23 As-Reported Same Station Pro Forma (1) Six Months Ended Six Months Ended Six Months Ended June 30, June 30, June 30, 2008 2007 2008 2007 2008 2007 Radio Segment Net operating revenue $60,010 $61,736 $59,338 $61,736 $60,010 $62,377 Station operating expense 45,311 45,968 44,828 45,968 45,311 46,525 Operating income $14,699 $15,768 $14,510 $15,768 $14,699 $15,852 As-Reported Same Station Pro Forma (1) Six Months Ended Six Months Ended Six Months Ended June 30, June 30, June 30, 2008 2007 2008 2007 2008 2007 Television Segment Net operating revenue $8,864 $8,568 $8,864 $8,568 $8,864 $8,568 Station operating expense 7,356 7,043 7,356 7,043 7,356 7,043 Gain on asset exchange (224) - (224) - (224) - Operating income $1,732 $1,525 $1,732 $1,525 $1,732 $1,525 As-Reported Same Station Pro Forma (1) Six Months Ended Six Months Ended Six Months Ended June 30, June 30, June 30, 2008 2007 2008 2007 2008 2007 Depreciation and amortization by segment Radio Segment $3,153 $3,045 $3,096 $3,045 $3,153 $3,165 Television Segment 1,000 789 1,000 789 1,000 789 Corporate and Other 106 98 106 98 106 98 $4,259 $3,932 $4,202 $3,932 $4,259 $4,052 (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 June 30, 2008 and 2007 (amounts in 000's except per share data) (Unaudited) Pro Pro Pro Pro Forma(1) Forma(1) Forma(1) Forma(1) Three Three Three Three Months Months Months Months Ended Ended Ended Ended Septem- Decem- March 31, June 30, ber 30, ber 31, 2008 2007 2008 2007 2007 2007 Consolidated Net operating revenue $31,532 $32,193 $37,342 $38,752 $36,500 $37,537 Station operating expense 25,421 26,284 27,246 27,284 26,239 27,352 Corporate general and administrative 2,552 2,316 2,574 2,606 2,272 2,606 Gain on asset exchange - - (224) - - - Operating income 3,559 3,593 7,746 8,862 7,989 7,579 Interest expense 1,995 2,297 1,876 2,281 2,283 2,093 Other expense, net 20 35 7 47 60 131 Income tax expense 634 509 2,403 2,686 2,315 2,222 Net income $910 $752 $3,460 $3,848 $3,331 $3,133 Earnings per share: Basic $0.05 $0.04 $0.17 $0.19 $0.17 $0.16 Diluted $0.05 $0.04 $0.17 $0.19 $0.17 $0.16 Pro Pro Pro Pro Forma(1) Forma(1) Forma(1) Forma(1) Three Three Three Three Months Months Months Months Ended Ended Ended Ended Septem- Decem- March 31, June 30, ber 30, ber 31, 2008 2007 2008 2007 2007 2007 Radio Segment Net operating revenue $27,381 $28,203 $32,629 $34,174 $32,186 $32,992 Station operating expense 21,913 22,802 23,398 23,723 22,756 23,738 Operating income $5,468 $5,401 $9,231 $10,451 $9,430 $9,254 Pro Pro Pro Pro Forma(1) Forma(1) Forma(1) Forma(1) Three Three Three Three Months Months Months Months Ended Ended Ended Ended Septem- Decem- March 31, June 30, ber 30, ber 31, 2008 2007 2008 2007 2007 2007 Television Segment Net operating revenue $4,151 $3,990 $4,713 $4,578 $4,314 $4,545 Station operating expense 3,508 3,482 3,848 3,561 3,483 3,614 Gain on asset exchange - - (224) - - - Operating income $643 $508 $1,089 $1,017 $831 $931 Pro Pro Pro Pro Forma(1) Forma(1) Forma(1) Forma(1) Three Three Three Three Months Months Months Months Ended Ended Ended Ended Septem- Decem- March 31, June 30, ber 30, ber 31, 2008 2007 2008 2007 2007 2007 Depreciation and amortization by segment Radio Segment $1,562 $1,566 $1,591 $1,599 $1,660 $1,723 Television Segment 395 389 605 400 405 425 Corporate and Other 53 47 53 51 48 58 $2,010 $2,002 $2,249 $2,050 $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 June 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 June 30, Comparable June 30, June 30, Comparable June 30, 2008 Period 2008 2007 Period 2007 Consolidated Net operating revenue $37,342 $(373) $36,969 $38,421 - $38,421 Station operating expense 27,246 (255) 26,991 27,016 - 27,016 Corporate general and administrative 2,574 - 2,574 2,606 - 2,606 Gain on asset exchange (224) - (224) - - - Operating income $7,746 $(118) $7,628 $8,799 - $8,799 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 June 30, Comparable June 30, June 30, Comparable June 30, 2008 Period 2008 2007 Period 2007 Radio Segment Net operating revenue $32,629 $(373) $32,256 $33,843 - $33,843 Station operating expense 23,398 (255) 23,143 23,455 - 23,455 Operating income $9,231 $(118) $9,113 $10,388 - $10,388 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 June 30, Comparable June 30, June 30, Comparable June 30, 2008 Period 2008 2007 Period 2007 Television Segment Net operating revenue $4,713 - $4,713 $4,578 - $4,578 Station operating expense 3,848 - 3,848 3,561 - 3,561 Gain on asset exchange (224) - (224) - - - Operating income $1,089 - $1,089 $1,017 - $1,017 Saga Communications, Inc. Selected Financial Data Non-GAAP Disclosures For the Six Months Ended June 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 Six Dispositions Six Six Dispositions Six Months Not Included Months Months Not Included Months Ended in Entire Ended Ended in Entire Ended June 30, Comparable June 30, June 30, Comparable June 30, 2008 Period 2008 2007 Period 2007 Consolidated Net operating revenue $68,874 $(672) $68,202 $70,304 - $70,304 Station operating expense 52,667 (483) 52,184 53,011 - 53,011 Corporate general and administrative 5,126 - 5,126 4,922 - 4,922 Gain on asset exchange (224) - (224) - - - Operating income $11,305 $(189) $11,116 $12,371 - $12,371 Adjustment Adjustment For For As- Acquisitions Same As- Acquisitions Same Reported and Station Reported and Station Six Dispositions Six Six Dispositions Six Months Not Included Months Months Not Included Months Ended in Entire Ended Ended in Entire Ended June 30, Comparable June 30, June 30, Comparable June 30, 2008 Period 2008 2007 Period 2007 Radio Segment Net operating revenue $60,010 $(672) $59,338 $61,736 - $61,736 Station operating expense 45,311 (483) 44,828 45,968 - 45,968 Operating income $14,699 $(189) $14,510 $15,768 - $15,768 Adjustment Adjustment For For As- Acquisitions Same As- Acquisitions Same Reported and Station Reported and Station Six Dispositions Six Six Dispositions Six Months Not Included Months Months Not Included Months Ended in Entire Ended Ended in Entire Ended June 30, Comparable June 30, June 30, Comparable June 30, 2008 Period 2008 2007 Period 2007 Television Segment Net operating revenue $8,864 - $8,864 $8,568 - $8,568 Station operating expense 7,356 - 7,356 7,043 - 7,043 Gain on asset exchange (224) - (224) - - - Operating income $1,732 - $1,732 $1,525 - $1,525
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