SANTA MONICA, Calif., Aug. 5 /PRNewswire-FirstCall/ -- Entravision Communications Corporation (NYSE: EVC) today reported financial results for the three- and six-month periods ended June 30, 2009.
Historical results, which are attached, are in thousands of U.S. dollars (except share and per share data). The results of our outdoor operations are presented in discontinued operations within the statements of operations in accordance with SFAS 144, "Accounting for the Impairment or Disposal of Long-Lived Assets". This press release contains certain non-GAAP financial measures as defined by SEC Regulation G. The GAAP financial measure most directly comparable to each of these non-GAAP financial measures, and a table reconciling each of these non-GAAP financial measures to its most directly comparable GAAP financial measure, is included below. Unaudited financial highlights are as follows:
Three-Month Period Six-Month Period
Ended June 30, Ended June 30,
-------------- --------------
2009 2008 % Change 2009 2008 % Change
---- ---- -------- ---- ---- --------
Net revenue $48,696 $62,932 (23)% $90,411 $118,585 (24)%
Operating
expenses (1) 29,646 36,898 (20)% 61,459 72,307 (15)%
Corporate
expenses (2) 3,378 4,477 (25)% 7,251 8,931 (19)%
Consolidated
adjusted
EBITDA (3) 16,323 22,371 (27)% 23,039 39,034 (41)%
Free cash flow (4) $5,217 $9,871 (47)% $4,118 $14,289 (71)%
Free cash flow
per share, basic
and diluted (4) $0.06 $0.11 (45)% $0.05 $0.15 (67)%
Net income (loss)
from continuing
operations $(1,827) $11,661 NM $(16,321) $4,611 NM
Net income (loss)
applicable to
common
stockholders $(1,827) $10,742 NM $(16,321) $3,038 NM
Net income (loss)
per share from
continuing operations
applicable to
common
stockholders,
basic and
diluted $(0.02) $0.13 NM $(0.19) $0.05 NM
Net income (loss)
per share applicable
to common
stockholders,
basic and
diluted $(0.02) $0.12 NM $(0.19) $0.03 NM
Weighted average
common shares
outstanding,
basic 84,187,128 91,573,187 84,235,509 93,495,230
Weighted average
common shares
outstanding,
diluted 84,187,128 91,835,027 84,235,509 93,811,980
(1) Operating expenses include direct operating, selling, general and
administrative expenses. Included in operating expenses are
$0.4 million and $0.4 million of non-cash stock-based compensation
for the three-month periods ended June 30, 2009 and 2008,
respectively and $0.7 million and $0.7 million of non-cash
stock-based compensation for the six-month periods ended
June 30, 2009 and 2008, respectively. Operating expenses do not
include corporate expenses, depreciation and amortization, impairment
charge, gain (loss) on sale of assets and loss on debt
extinguishment.
(2) Corporate expenses include $0.4 million and $0.5 million of non-cash
stock-based compensation for the three-month periods ended
June 30, 2009 and 2008, respectively and $0.8 million and $0.9 million
of non-cash stock-based compensation for the six-month periods ended
June 30, 2009 and 2008, respectively.
(3) Consolidated adjusted EBITDA means net income (loss) plus loss (gain)
on sale of assets, depreciation and amortization, non-cash impairment
charge, non-cash stock-based compensation included in operating and
corporate expenses, net interest expense, loss on debt
extinguishment, loss from discontinued operations, income tax
expense (benefit), equity in net income (loss) of nonconsolidated
affiliate and syndication programming amortization less syndication
programming payments. We use the term consolidated adjusted EBITDA
because that measure is defined in our syndicated bank credit
facility and does not include non-cash stock-based compensation,
loss (gain) on sale of assets, depreciation and amortization,
non-cash impairment charge, net interest expense, loss on debt
extinguishment, loss from discontinued operations, income tax
expense (benefit), equity in net income (loss) of nonconsolidated
affiliate and syndication programming amortization and does include
syndication programming payments. While many in the financial
community and we consider consolidated adjusted EBITDA to be
important, it should be considered in addition to, but not as a
substitute for or superior to, other measures of liquidity and
financial performance prepared in accordance with accounting
principles generally accepted in the United States of America, such
as cash flows from operating activities, operating income and net
income. As consolidated adjusted EBITDA excludes non-cash (gain)
loss on sale of assets, non-cash depreciation and amortization,
non-cash impairment charge, non-cash stock-based compensation
expense, net interest expense, loss on debt extinguishment, loss
from discontinued operations, income tax expense (benefit), equity in
net income (loss) of nonconsolidated affiliate and syndication
programming amortization and includes syndication programming
payments, consolidated adjusted EBITDA has certain limitations
because it excludes and includes several important non-cash
financial line items. Therefore, we consider both non-GAAP and GAAP
measures when evaluating our business. Consolidated adjusted EBITDA
is also used to make executive compensation decisions.
(4) Free cash flow is defined as consolidated adjusted EBITDA less cash
paid for income taxes, net interest expense and capital expenditures.
Net interest expense is defined as interest expense, less non-cash
interest expense relating to amortization of debt finance costs, less
interest income less the change in the fair value of our interest
rate swaps. Free cash flow per share is defined as free cash flow
divided by the diluted weighted average common shares outstanding.
Commenting on the Company's earnings results, Walter F. Ulloa, Chairman and Chief Executive Officer, said, "Our second quarter financial results reflect the continuing recession and the challenging advertising environment. We are continuing to aggressively manage our costs to maximize our cash flows. Our television and radio operations continue to deliver solid ratings in the nation's most densely-populated Hispanic markets. We believe we are well positioned to benefit when the economy recovers, given the strength of our brands and our ability to deliver the valuable Hispanic audience to advertisers."
The Company also announced that it repurchased from Univision Communications, Inc. 0.9 million shares of Entravision Class A common stock for approximately $0.5 million in the second quarter of 2009.
Financial Results
Three Months Ended June 30, 2009 Compared to Three Months Ended June 30, 2008 (Unaudited)
Three-Month Period
Ended June 30,
--------------
2009 2008 % Change
---- ---- --------
Net revenue $48,696 $62,932 (23)%
Operating expenses (1) 29,646 36,898 (20)%
Corporate expenses (1) 3,378 4,477 (25)%
Depreciation and amortization 5,191 5,642 (8)%
Impairment charge 2,720 - NM
----- ---
Operating income 7,761 15,915 (51)%
Interest expense, net (8,404) 3,458 NM
------ -----
Income (loss) before income taxes (643) 19,373 NM
Income tax expense (1,099) (7,674) (86)%
------ ------
Net income (loss) before
equity in net loss of
nonconsolidated affiliates
and discontinued operations (1,742) 11,699 NM
Equity in net loss of
nonconsolidated affiliates,
net of tax (85) (38) 124%
------- -------
Income (loss) from
continuing operations (1,827) 11,661 NM
Loss from discontinued
operations, net of tax - (919) NM
------- -------
Net income (loss) $(1,827) $10,742 NM
======= =======
(1) Operating expenses and corporate expenses as defined above.
Net revenue decreased to $48.7 million for the three-month period ended June 30, 2009 from $62.9 million for the three-month period ended June 30, 2008, a decrease of $14.2 million. Of the overall decrease, $7.2 million came from our television segment and was primarily attributable to a decrease in local and national advertising rates, which in turn was primarily due to the continuing weak economy, partially offset by the increase in retransmission consent revenue of $2.9 million. Additionally, $7.0 million of the overall decrease was from our radio segment and was primarily attributable to a decrease in local and national advertising rates, which in turn was primarily due to the continuing weak economy.
Operating expenses decreased to $29.6 million for the three-month period ended June 30, 2009 from $36.9 million for the three-month period ended June 30, 2008, a decrease of $7.3 million. The decrease was primarily attributable to decreases in expenses associated with the decrease in net revenue and salary expense due to reductions of personnel and salary reductions.
Corporate expenses decreased to $3.4 million for the three-month period ended June 30, 2009 from $4.5 million for the three-month period ended June 30, 2008, a decrease of $1.1 million. The decrease was primarily attributable to the elimination of bonuses paid to executive officers and a decrease in salary expense due to salary reductions.
