Urban One (UONE) 10 Jun 242024 Q1 Earnings call transcript

Welcome to Urban One's First Quarter Conference Call.

During this conference call, Urban One will be sharing with you certain projections or other forward-looking statements regarding future events or its future performance. Urban One cautions you that certain factors, including risks and uncertainties referred to in the 10-K, 10-Q and other reports it periodically files with the Securities and Exchange Commission, could cause the company's actual results to differ materially from those indicated by its projections or forward-looking statements.

This call will present information as of June 10, 2024. Please note that Urban One disclaims any duty to update any forward-looking statements made in this presentation. One about discuss its Urban measures non-GAAP call, talking in performance. this may some also financial In These measures company's will at the can course be found www.urbanX.com. reconciled to this be or GAAP call, in its the on press which of release, website either during

X/XX/XX be access the (XXX) A Time, replay www.urbanX.com. of are authorized replay replay direct. the is (XXX) copies available International made for conference conference on is by Callers to be and will call. p.m. the X/XX/XX. may may replay live or The p.m. after of a One's call be available available at or calling upon. will No XX:XX website days this the replay X:XX XXXXXXX. recordings website also Access X Callers XXX-XXXX. dial of from code will Eastern corporate call be until may relied access on Urban audio The the XXX-XXXX. other

the Alfred joined call Thompson, Officer. by Financial I is will Chief over Peter who Chief now C. Executive of One, to turn D. Urban Officer Liggins,

operator, and much, is EVP Officer and and at of Kris And One joining General I, as Peter very who usual; Chief Jody TV you Thank CLEO, our thank you. Simpson, Financial Karen and Wishart, Drewer, Counsel; our also Administration. our

as have and arduous results XXXX done are year-end XXXX the call from we and new first with going also well. with the audit in press as seen our quarter long a the haven't a a you We firm, a completed been while we've audit filings audit through because finally release, audit and but

with compliance so And officially we're in NASDAQ. back

filings our to that and terms forward And so very come. in time eyes keep to moving about happy of

we you along EBITDA. giving And guidance of from we've in that the range. been The year-end came at all adjusted results, million were right $XXX.X our year-end in saw

to almost at going XXXX do on talk depending to we But how to the asked to time in or at basis, EBITDA $XXX EBITDA willing is been of XXXX want in and position year. that like. X-month a about a do to expect, million haven't is is haven't robust we been we've in do been guidance. point consistent that what Something we $XXX political calendar the million we on mark, to XXXX look provide And think

-- be out. that, it's leverage play in to triangulate ratios, with starting landscape So cetera. political think going we it, about The you we're hopeful terms but you of now. can yet et is where to We're

had it For good liked really us, presidential the we like primary robust, and have we think -- conversations. could it be as to would be, landscape season having robust but we're the wasn't as will quite that

with into with get than will reporting dealing over turn numbers it So I X the because to that, we're to specifics of more usual periods. the Peter

So Peter?

Thank you, Alfred.

got clarifications. Just for audited QX results be a of would couple 'XX. technically We've unaudited.

reviewed finish adjusted signed $XXX to and the EY until range. not Although annual number referred off. It's it's EBITDA been by would then And million, $XXX out audited the guidance Alfred be the audit. in million that actually they

down million. was by year-over-year of for December on approximately quarter for XXXX, XX, revenue same-station Net XX% by net consolidated X.X% a decrease XX.X% $XXX.X segment that, Radio with And basis. million, $XX.X the year-over-year was revenue ended

Radio And XX.X% division decline X.X%. largest that of the down XX% local the our down According in to sales the XX.X%. was expected. was which down ad that market, Miller QX, unexpected. political down National against Kaplan, ad $X.X was That the or advertising year-over-year, were X.X% down was against market, million sales in were not driver

to segment was year. revenues decreased quarter. down Direct X.X% down, for the QX in million, for all million national revenue the stream $XX.X radio, podcast from the Reach Net revenue up. were Adjusted and EBITDA the for in XX.X% the while sales Net million. segment $X.X digital quarter, prior $XX.X up by was local were XX.X% fourth

which was TV X.X%. the revenue recognized helped impact. million rate the card along of $X.X We down a from An additional was rate ADU X.X%. EBITDA up approximately current drove mitigate quarter, Adjusted up XX%. advertising applied our million, decrease updated was but overall increased television cable to Cable $XX.X delivery of with rate reflecting the segment towards during revenue volume units

One, increases TV as Cable by million TV by down subscribers for XX.X QX, million of rate affiliate at -- Cable Nielsen the $XX.X to with subs favorable QX XX.X sorry, churn. 'XX million subs. finished CLEO and had offset XX.X at end measured revenue XX.X% was by million compared net TV Nielsen

to Net revenue the a at X.X% but million. an Consolidated was segment revenue down $XXX.X decrease was increase on QX year-over-year for of net of approximately year-over-year, revenues. on million, X% same-station Moving Radio a $XX.X X.X% basis. the by

sales local sales Kaplan, that our According down ad our the were down was was were ad that market against XX% X.X%. to down And Miller a national X.X% down X.X%. against market

XX.X% segment Adjusted $XX Net X.X% down, down national XX.X%. was revenue revenues EBITDA $X.X sales $X.X was the quarter. quarter, were EBITDA decreased by to podcast and million. while XX.X% all prior for were first radio, million, the down the streaming up was Net Direct from the $X QX for CTV, for down local quarter. million, Adjusted for revenues million year. segment Reach the digital

million impact. cable from updated delivery, an the current quarter, $XX.X unit volume One the television card rate and cable revenue increased but increased of rates down our advertising during approximately help TV recognized X.X%, drove average segment mitigate X.X%. reflecting We rate Urban of was down, decrease revenue sponsorships And

down Cable end XX.X rate million QX TV Nielsen of by finished of subs. TV million million, $X One had as measured XX.X% $XX.X $X at at $XX.X compared negative CLEO Nielsen, a by churn. million Cable offset QX. the increases of by revenue million for subscribers TV XXXX to with favorable And was affiliate

the the operating expenses assets of $XXX.X to prior expenses, impairment for QX. stock-based to X.X% operating Turning approximately from expenses long-lived Radio up Operating increased for million $X.X amortization, depreciation million. year. X.X% up were and and excluding or compensation quarter,

Radio effective approximately expense. added which August was Houston The X, $X.X acquisition, of XXXX, million

same-station that, were revenue down. fees actually expenses basis, sales for bonus down. a On to if you compensation, were commission, rep relative national expenses all normalize and such as So debt bad variable

Reach down lower and down advertising to acquisition reduced variable such expenses as in by by commissions expenses driven the operating revenue. XX.X%, talent tied expenses were variable compensation. tied were sales by revenue expenses Operating bonus predominantly digital to and direct segment traffic XX.X%, sales driven compensation,

year-over-year. by tax noncash, credits. $X and for that originals, was XXXX $X.X to million TV were down Cable increase $XXX,XXX write-offs EBITDA. related added amortization That was to programming adjusted expenses of up Content for and X.X% an was by back driven million, pre-XXXX

of in This a due by series. reduction in driven increase promotional and spend the $XXX,XXX return was bonuses reduced quarter. offset $XXX,XXX media million in reduced the by timing travel of expenses to $X.X and of

in primarily audit were third-party $X.X and higher million, approximately segment expenses. for TV a expense One noncash expenses and Elimination of consulting award up result Operating as a and higher Corporate the CEO's

period hardware including And adjusted $X.X nonrecurring million a the for we noncash for right EBITDA, added computer sheet losses. audit. professional adjustments, for and to For TV for the back expense related balance million One $X.X fees prior $X.X off award million

million long-lived comp For the approximately of up and incurred stock-based the amortization, million, of first impairment excluding XXXX. approximately quarter quarter, increased in and XX.X% $XX.X assets to expenses, $XX.X first depreciation operating from

Radio added were $X.X expense. of expenses The XX.X% up operating or $X.X million. acquisition approximately million Houston Radio

So expense Houston related the increase to bulk of the the acquisition.

predominantly revenues. X.X%, were driven digital driven in expenses expenses segment decreased operating acquisition lower which station down the and affiliate down Reach talent were expense direct traffic related costs, programming by lower XX.X% by compensation costs. to Operating lower

expenses $X.X million to event. of going million year-over-year. promotion and hours, the million for was Cable of acquisitions expense million $XXX,XXX and were driven an increase Content amortization of TV by in $X down originals, out expense was due in increase down X.X% timing by to offset of was increase incremental which Urban One Honors was $X.X license. there a marketing campaigns, travel $X.X

result to We Corporate audit the primarily of as $X.X million professional was in higher which remediation EBITDA. by prolonged adjusted $X nonrecurring a approximately professional and third-party back million, expenses Operating segment, Elimination to of related fee added and a up had controls, fees.

Consolidated the was income approximately EBITDA was $XX.X decrease down of first income adjusted was was quarter, EBITDA million a operating XX.X%. operating digital $XX.X Consolidated and adjusted down $XX $XX XX.X%. the of for a Consolidated decrease digital for million million broadcast approximately and fourth XX.X%. million, quarter, broadcast Consolidated XX.X%.

quarter. fourth Interest $XXX,XXX expense the million made lower interest to year. And income debt for compared $X.X from year payments for approximately down $X.X $XX.X approximately to $XX.X million quarter million QX due in to cash the the company million of prior prior increased the decreased the the balances. in to in overall Interest

due decreased made expense the approximately the increased payment of next income repurchased quarter, quarter is $XX.X $XX.X in to to Interest overall on And car. from the company million last debt an the payments last balances. Interest million of cash approximately debt down for the first The $XXX,XXX $XX service company of due X. The million semiannual from year lower average at year. $XX XXXX its interest $X price notes QX, million August in million during XX.X% quarter. to

charge Washington, recorded impairments XXXX. in first for primarily market in D.C. QX, and impairment our is recorded no A there $X were million quarter radio

the Provision taxes approximately quarter amount million company income was the million. $X.X income cash quarter and first for the for approximately paid $X.X in approximately $X.X cash Provision was for and the taxes fourth taxes the paid $XXX,XXX. company million taxes income of for of

for a $XX to approximately or million quarter net 'XX. quarter approximately compared per $X.XX per share share net income first per $X.X $X.XX million the of first And million share the share to was the net quarter, per for million for or compared loss of fourth or of or of $X.XX $X.X 'XX. loss $X.XX Net loss a was $X.X

quarter, Class company stock of amount approximately XXX,XXX the million. D the in fourth $X.X common repurchased shares of the During

the XXX,XXX quarter, Class approximately in first company the approximately million. employee the repurchased of $X.X D that And the to stock pool. During common amount of related stock shares

Capital million, compared were EBITDA cash XXXX, approximately at to X.XXx. $XXX.X quarter $X.X expenditures of for million. a for adjusted XX, $XXX.X LTM, gross million of resulting net net $XXX.X in unrestricted ratio was as which $XXX Ending And million. of debt debt approximately total leverage we million, December the total was

the X.XXx. for net total Radio leverage acquisition, was Houston forma Pro

approximately to net pro $XXX.X XX, net total $XXX.X of of adjusted Reported March in $XXX gross ratio LTM. debt EBITDA Ending X.XXx, was million. total the of million, total we And of acquisition, for unrestricted a was debt $XXX.X which As forma for compared leverage resulting was Radio X.XXx. leverage million Houston cash million, XXXX, net

to And hand that, shall back Alfred. I with

a that's mouthful. And

you circling not reviewed, being numbers on but back XXXX guide. We have been the Thank asking. audited, for the the not do the But full EBITDA EBITDA looking adjusted any on So QX continuing We're on people questions adjusted focused gave M&A other opportunistically. that plan. very correction manage We on the XXXX things Peter. always company's at down. have to year leverage table

leverage, been to have lower to We continuing on that. company's and do continue we'll the focused

look top can't count growth. we delevering industry opportunities, like the only to M&A as at where businesses in, that you Whenever hopefully be them we're in particularly well, but we accretive not level on line

any of miss should into to needs accretive kind category, of So and fit synergistic which produce M&A deleveraging. sort the

that's terms that's going the stuff So of year. intention where is our and for in table forward what we're sitting this now on

that have in decision-making laid not the you, on decisions at our for process. out those thesis any and just come overarching concrete But this goals we time. capital So to guide allocation point I

the I'd operator, call. that, love participants up with questions from open on the So it for to

a have with from I And Instructions] Tim [Operator question Schroders. Daggett

and I after taxes. the to pay looks is think expect the should interest like you per CapEx $XX cash specifically down? spend do and CapEx million this charges the fixed And How for year XXXX, year the your on It about much now how about taxes?

We is I big are of penciled real sort $X-ish on sort out doing. projects normally mean we're of CapEx CapEx. -- at a couples million there estate run Yes. of

I be or million think this it $XX year. could $X million

million of taxpayer we I couple years. out the it want to for federal around think a then cash don't $X mark. And pencil another be taxes, we

got second, we CapEx sorry, couple probably So one year, taxes. of think million We've and A -- million million a so what $X cash this pencil at? of out on taxes. about are $X $X I looking million kind -- on

of in And penciled Indianapolis, the know the bought expand actually been to stations MS operation you Indianapolis. what cluster we separate time. We for original radio But the is for We've that. have We big deal had in consolidation in our our don't I CapEx right? facility. facilities with made in there. running One, some that own on quite ultimately project Radio X a R, landlord

our facility the facility. to original expansion while So we moved in Emmis we're the building over out everybody

So we're that's actually Indianapolis, taken. It expense another save year that we done where But to make we're probably what million from $X took a paying. deal. the us get currently longer to go going in and decide operating once to there in right

for that's this So what's driving the CapEx year.

Okay. Great.

less add that we if about at it's $XX million of I on else should there in outflows of fixed interest, the So terms midpoint anything and cash taxes. CapEx up, that kind gets charges Is cash million consider there I the $XXX of EBITDA free you $XX of else of million million, of flow? this year? for to consider $XX anything to need that to Is

versus Yes. swing One can programming. The bit one that TV thing is cash a

future this And out going got amortized we've for year, that get in cash so doesn't door until additional the periods.

to get that. of That's should the ticket So that sort easy won't item you probably million be out. in big $XX-ish pencil for

the forecast it is moment. come doesn't just the That as Okay. to at that's but pass, necessarily

from Wave comes with Stifel. question next our Dominic And

on you come a forecast you in guys you little then you're I in Do ad describe more there? know like guys dependent of able kind persist? And just the sort know national expect you was little in what follow-up Can I touch Can of how just provide color kind what that at said you're -- market seeing general a EBITDA quarter. to target political like little that down fourth than Are on, to some of 'XX? might a the outcomes. of bit ad your guys on you a the just and for you just thinking political first kind said on is

Yes.

even well $XX for budgeted million incredibly to year, political cycles, couple this we low did around. which two last Atlanta, of relative the is last in year we but So down the goes

conservative. And a is percent think are that's political So starting XX-plus to almost the amount digital. Normally, switch of that seeing I is we our $XX radio. hopefully to what of million, bulk is fair

some that see switch I think to towards we're of starting digital.

in factored have national, And upside we're that's on political could quite a digital not for our in. And division digital while. so And on they that just of come our we had outperforming seems -- team, in general, been reversed -- who we've before. of we necessarily some didn't who to some back in have the could then just clients -- have reversed National sales and same a as it's had terms bunch corporate volume

more And than the did. market hurt so got bit we a

we normalizes. that on better we look I local. into we're are QX, doing to relative think over time, as And actually national than

doesn't or because we're not it's big $X the as that So radio QX. million maybe really some players, flip-flopped million that of But national as in client other recur X $X impact can client a that comps.

And saw activity. corporate sales our of you that on some in going so

Okay. Just of of guys can official up. read-through is to Got how you it. I on not Are maybe if kind color, able along? you're lastly, And coming seeing? follow just write any any kind but XQ just guidance, some what

of exception soft political. with the it's Well,

I in churn softness there. we're TV think some to continuing plus in experience delivery cable

in softness of is that and the political. There's TV. then in softness some there's digital some So offsetting

at. where kind that's the it's of of shape So

given radio guidance. People have been

in now do right trying QX is radio our Our business. to

factored. of is that All

is And But a that's be so let's into not that say going us. giving. all great guidance the factored QX quarter we're that to for

But outlined until okay are too a it soft to until big what we even Now placed And conversations can't orders QX, lot political, through you. the on to get about the so we so pretty running, feel QX we the around we're like count wide feel right? And almost but a going right? to so frankly, start -- is of being quite you now, there's about just it the are don't is with guide problem conversations able we just But on reason those encouraging. good hits, actually -- optimistic.

Next Hal BNP Instructions] comes with from [Operator Paribas. Steiner question

of trends like year on of just And the trying a those On reverse you're what in this the there? on guess performance to bit back X or of focusing bit a could the last improve some little talk to extent, I work sort of lesser little more discussion be digital, sort a to Qs. reach about on just you softness digital? the sort been for or what's And to going driving of

like Yes. there But it post-George targeted talked minority-owned dollars I about that benefited diversity happened as wave minority Floyd guess haven't of mean we I media. a much. that was

didn't that, -- the also marketplace. have You advertising prior to in you uncertainty

happened. rates of soft. couple a So things Interest advertising up. went got National

you You saw backs helping our diversity then you by fashion. win diversity it started it and everywhere, that and and understated Paramount becomes radio had more certain -- dollars, companies. We in particularly was as the started that you of And us. down right? at to And you started other the more concept and see see Disney, have the at E&I falloff political a saw

So People always experience the but dollars. about off traditional in factor what feels contribute but media environment, and national Meta and to a it, across a I of economic. And really Reach. digital there that's recession, sector. felt Maybe absolutely a you get the in soft was talk we're nobody media and an a like diversity but did economic recession. you And that then Google in tail into you see rest didn't ad

shift fall systems then see a dollars. being right? off of haven't driver -- was out into -- then news all it And that of is that the correct sort we're of the when traditional going We publishers off. I to through general be working that's distribution knew so much digital of recession, wait and I national second this QX happening X sort blame you're know happened of of and don't and when that have the A X is X into year figured falling quite One talking would to this look, itself recession drivers. to kind systems, been really going does digital yet. say months. continued the out ad systems. And we're and how tough, distribution in I ad would sort going last months, just when to say diversity shift bucket And I struggling. bucket be stuff X lot that of a does Meta. the distribution ad there of how what's Google about

fully that strategy we're I going we're turn for right land how I a how would answer to right year, you strategy you a north, giving of where view second. we're the in not to going the around to this that have so back don't solid take now, say you is And of of but EBITDA this number place.

And solution know don't so any taking much is we at that to needs tricky, sort that again, the investment are that people most I've right? When for radio assets any helps that I both of our felt have. I those of some But you TV our how you're just to into accretive M&A in do internal already know got there scale in you lot. very be if that us business. a not don't deleveraging of there predicting always that's is decline of market sort so. sure kinds that account make deals, and good

was very it. helpful. it. Got all Got That

Okay. -- an I of to like, that last maybe the has on you spending like side I I expenses I guess commentary reduce any for SG&A for of there sort X up, been there's going mean those know little sort forward. in just on I SG&A. try have sort investment has sort thoughts bit about. And on of line was to the just do expense I'm any quarters a of know going the and surprised been which that of elevated expense then. in corporate

and the mean million period called But fees in obviously, and part kind ran there were in onetime on million, corporate driving in I super that out what's of driving It's called have prolonged I it. And X-plus audit. earlier cash order audit called I QX, that's entries also We up. that's out we're of because deduct adjusted SG&A cleanup. I that QX. over a it a as that's the quarter going $X I cash out. by a had back which there's expenses And should that a of years way, it back went that got about some we that additional that's through some the as Yes. question expensive there adding out. consultancy flow detailed for were SG&A but EBITDA, tidy-up corporate fourth -- $X.X of in

Okay. Got it.

-- missing of not for some Sorry that. for

wasn't through. lot was No, a enough. going I I probably clear I -- no, was There was

just I And on balance Understood. leverage then is I of sort of where you, now thrown mostly continuing and TV that. And on talked -- of have of if down recently focused just asset thoughts cash my about guess it kind Bounce that's manage of asset? or as like sort sort hear be sounds sort guess all sort of that. really curious out to Scripps that one one any very other you're marketing the I might was do like today? And of you been only and of I'm

signed We NDA. going to the the participate process. Yes. in We're

not that any you to don't -- are synergies stuff you we help for delever synergies. that can acquisitions, a look have have places information that the provide accretive great where We best competitor. -- can The It's create create yet. places

particulars audience idea tell would now of are there's And And the target cost right programming the I same the what what acquisition be. promotion because couldn't so no numbers this. I focused potential on you we've even no of balance have synergies. I have expectation exactly sales what idea synergies, synergies, been

what saw it think out worth. they they I where of con something thought I kind in called a Scripps was call

somebody or didn't case didn't in pay their reasons happen. to some willing it for lot you're And than BET, early BET, it that. so at be But right? And they at it so makes but we things will because expectations, is because they price relative of works price, like now a absolutely stages very more sell. everything it -- sense, table for to at achieve sense, we're is to of the not them pay as just looking willing If to other made decided the the of which

hand $XXX.X then million. And today, on the cash on

little So end. bit up quarter a

further questions no time. have at this we And

to Thank today. and for statements quarter. these you forward talking we next and patience next to look you getting you, quarter, all to operator, thank you. your Talk us and Thank you caught up

does conference today. you conclude your That Thank for our for participation.

now disconnect. may You