Beasley Broadcast (BBGI) 1 Nov 232023 Q3 Earnings call transcript

[Audio Gap] Broadcast Group's Third Quarter 2023 Conference Call.

Before proceeding, I'd like to emphasize that today's conference call and webcast will contain forward-looking statements about our future performance and results of operations that involve risks and uncertainties despite in the Risk Factors section of our most recent annual report on Form 10-K as supplemented by our quarterly reports on Form 10-Q.

Today's webcast will also contain a discussion of certain non-GAAP financial measures within the meaning of Item 10 of Regulation S-K. A reconciliation of these non-GAAP measures with their most directly comparable financial measures calculated and presented in accordance with GAAP can be found in this morning's news announcement and on the company's website.

I'd also remind listeners that following its completion later today's call can be accessed for 5 days on the company's website, www.bbgi.com.

a Press today's site. Room find the release also and Investors section can copy press of on You of the this Broadcast like to would time, the At over conference to your CEO, Group's turn Beasley Caroline Beasley. host, I ahead. go Please

and CFO, Thank our to our Marie with me this morning. third you good Welcome conference quarter very call. much, is Tedesco, morning.

the led The third political, the which to cyclical X.X% with quarter saw advertising continued offset market softness decline. a in revenue of

or $X.X last million a growth we was resulting million, $X.X $X.X note, continued year's our expense $XX or million political million. excluding EBITDA our revenue approximately $X of respectively. with of However, operating X.X% million expenses revenue and decreased revenue in digital management down and year-over-year SOI by X.X%, down initiatives, and million And positive proactive to $X.X on our show of quarterly

While our of and overall up revenue we network was X.X%, of point XX% within and increasing we increases digital which digital, total are consistent a saw in revenue representing almost decreased basis XX%. reaching revenue With X.X% currently growth and down lower were in and our goal of digital XX% of political. by digital offset the down $X.X was total million revenue. excluding end or national, increases X% from for which XX% challenges The accounting of to network XX%

was side also And which softness and result X.X% a was local a direct X%. of down local local market, the X.X%. down market, down was of which local soft agency The was

And $X.X year. in from result, new prior a million mid-quarter new on our mobile with a efforts result the a local we business. focus of XX%, developing $X.X million, reprioritized grew As renewed direct business up softness, this as

prior million increased quarter representing $X.X we of down total the betting Sports sports year. recorded Boston, $XXX,XXX third betting prior by the revenue. which spending versus in the million quarter In was X% this year, with in sports generated category, the betting in from driven X.X% $X.X

We with to and increase in Boston quarter expect sports fourth Celtic Patriot, games. increased betting in Bruins

by decreases Detroit offset gains year-over-year in Philadelphia. were and These gains

total Now by showing declined business. focus a the down was which political, X.X%, local or on X.X% reflected X.X% quarter's improvement breaking July developing X.X%. down our revenue August September, increased and $XXX,XXX, down was excluding September, slight trends, direct

that our point basis. closed our fourth reduce Wilmington, same-station And note, station declined as proceeds was And excluding expenses was $XX announce X.X% I X.X%. and BOGS X.X%, in advantage down The to took balance same-station our I'm JBR, and down of million. X.X% XXX% by used X% debt same-station revenue to early cash sale trading of in below our along to increased happy a we and down same-station revenue par on political, SOI were sheet the quarter, and SOI on with of

In retain majority our revenue addition, we direct agency. digital the digital to of over JBR, to from our able were which shifted

Our and lower debt reduction interest by annual both $XXX,XXX. reduces approximately leverage expense will our our

will we quarter. give will deeper continue I'm into to bonds. the who to monitor to should now hand when repurchase over you market the determine We to conditions going Marie, it additional a dive

morning, Thanks, everyone. Caroline, good and

quarter or X.X% includes which team. $XX.X Third net from our $XXX,XXX revenue $X.X million decreased to X million,

revenue grow million the in quarter and Wilmington. decreased $XX.X X.X%. generated Myers XX.X% revenue Fort or continue this X.X% represents revenue including grew million We positive our for revenue quarter, and and and to growth political, $X we year-over-year to markets, of revenue Excluding sources. Boston, total now by revenue stream our of diversify will Augusta, Digital the X for

category X.X% XX.X% revenue. at quarter. to This remained Moving for Consumer quarter. declined total our category third services revenue the largest during categories of our

and recruitment. increases. category came However, from year-over-year in decrease largest delivered of dental The X our medical, this markets

accounted total for and Our second revenue. X.X% largest category XX.X% was fell of year-over-year retail, which

for number XX.X% compared betting, which The entertainment year-over-year category $X.X third X.X% Entertainment, revenues category decreased category up largest to million year-over-year. total quarter $X.X our Auto, fourth the revenues year X.X% generated includes sports revenue. represents quarter three, in prior X.X% saw of the the accounted and quarter. around of for and million total

We saw our import up quarter, in half X% auto increases XX% a more market, around of ads growth increased in Domestic auto the were than in Philadelphia. XX%. in while including advertising auto

Tier We X, National partly by auto X branding, strike. has auto been slowed somewhat, Auto have in Tier while a driven the and spike seen current domestic has this especially

reducing fifth declines continued the X% were revenue. improvement quarter year-over-year $X.X expect and or revenues X.X% million our the almost XX.X% revenue and partially declined million spot KadonKXCE-swap the SOI in $XX.X by is as auto of expenses million. finance XWEAM, We the up once quarter. And $XX.X our by same-station or resolved. Caroline, million offset excluding decreased acquisition revenue the in Guaranty and by X.X% echoing the the success with jumped million total million for same-station in divested Finance $X.X is strike was declined X.X% $X.X which or SOI to quarter and to $X.X Digital

WJBR, year-to-date not XXXX. October SOI on increasing revenue station X.X% increased same-station X, year-to-date station took Same does SOI Year-to-date decreasing reflect the same Year-to-date which sale decreased X.X%. with X.X% X.X%. revenue of place with in

quarter. in in to digital a $XXX,XXX for to compared corporate million. quarter XX% a year stock-based to decreased quarter $XXX,XXX $X.X and $XX,XXX or we is decreased in G&A in ago expenses. quarter, the decrease expenses decrease year-over-year Noncash The or related compensation wages Corporate the corporate income $XXX,XXX paid G&A the and XX% the same taxes to in

of negative Third goodwill reduced by discount and impairment quarter of noncash the increase in income market charge radio projections. a rates and $XX.X of revenue $XX.X $XX.X noncash impairment million XXXX driven million, overall a million reflects operating

losses, Excluding of million these income compared operating income noncash year operating $X.X a million. was in prior impairment positive a to $X.X positive our

was third million. expense $X.X of and interest million quarter year-over-year the quarter Third $XXX $XXX,XXX at debt outstanding end decreased to our

October early balance to sheet from some we XXXX, of which completed of cash Now XXX% net closed $XX and repurchase and at decreases a XX, to bonds XX.XXX%. This the of total our $XXX our debt on proceeds used WJBRFM, million. million October of was the discount sale

declined quarter as comparable million. taxes, $X.X for forma quarter reps XXXX was acquisition EBITDA million including such a or leverage, forma prior agency Third pro add year from and back build-out, adjusted $X.X compensation, XXXX X.XXx. losses LTM to pro XXXX noncash XX.X% certain agency the XXXX net digital from our and

on ended made interest on We $XX.X cash hand net million, that X. million of XXXX we quarter payments third of $XX.X the with August

expect in fourth we'll free positive the generate flow quarter. during are cash up to and cash fourth cash our continue build We from generating as operations, we quarter to

Boston the XXXX Our Year-to-date was and for CapEx were million, of which related to and quarter $X.X compares capital $X million, $X.X that that to spend $XX.X expenditures to our third was spend compares million. year-to-date of CapEx build-out. quarter XXXX million,

million spending XXXX year. to $X around the $X for CapEx in our be million to expect We full

turn And with back that, Caroline. to I'll it

Thank you, Marie.

I'm our revenue While new we quarter were faced and business with digital from initiatives. headwinds pleased in especially with third third National, quarter,

continued has digital the growth us decline revenue Our allowed in to offset spot. partially

and content fourth our strategy to . digital revenue, and continue we quarter helped this Our expect drive beyond. growth into the in successful

the in content to local tremendous multi-platform quarter. growth strategy audience third continues Our drive

monthly XX during compared Our to O&O audience same This from is XX approximately period reach the year. almost million audience increase million monthly XX% XXXX. represents in now last overall a

dominant grew market maintain X% brands the in XX-XX. continue our adults year-over-year by positions of key radio to Nielsen, share Our where with demographic

'XX However, recent a is 'XX this like users unique quarter, total QX our on the largest growth from with million ago the audience and for other to XX% O&O seen QX to the users quarters, by XX.X assets was unique of XX million in year compared digital quarter. increasing in

digital This led digital million an from And increase to year-to-date users on unique of growth of impressions XX% And our million. XX.X monthly over 'XX audience from XX% QX basis, during QX QX, and esports audience. a sellable represented growing total XX.X our audience to XX% 'XX. increased total to

In in is Plus, dedicated national the Radio discovery rolled launched version advanced a brand, podcast curation. a which U.S. QX, we and technically content to we bodcastradious.com, our new the successfully first-ever apps. U.S. out Podcast radio brand branded of and more

October, is format where a in and new in featuring artists new Additionally, channels our have markets side which on currently country on launched focused a music. country we solely their process, format we

with more this when money And next to on shut just you in this for Now will out We a have on our as ever may year-end, League. closed $XXX,XXX year. total And have for prize additional of esports. finish best weak winning Overwatch season an this on $XXX,XXX our we'll down the moving and call. accounted in quarterly the place by second the heard, likely

National audience revenue decline. further expansion uncertainty in advertising, our and quarter the remain impact lessen of fourth diversification continued into revenue on maximize to and Looking with driving goals

We to flow improving expense. decrease us will continue reduce our margins are interest that focused our allow growing on and leverage our cash our debt, to and lower free

as of and being So up approximately and was X%. quarter down, November down down fourth XX% is is revenue October down X% pacing December and our pacing breaking today, is X% that

revenue that quarter year, year. down X%. with $X.X of with X% political million Last booked December down fourth pacing million political, X% last is $X.X of and down pacing Excluding date of November October this net as X%; we up about recorded

developing to on softness continue the new offset and local business the comps. We to be digital focused direct and super political

the in status October, the we Q&A, our of listing, trading I'd no to effect this before regarding received fact notice immediate going Lastly, on address NASDAQ shares. of like our has from that to

this intend to to regain reasonable have available to compliance. and situation, rectify XXX days options we all We consider

members across today. you thank are and for to Finally, and acknowledge the company doing they've on our I'd for very done everything like team much the call participating

We have several questions. received

to I'm to back Marie, you. going over So hand it

is, Caroline. asset do a the we of do more And sales? questions. And receive the handful see yes, first did Thanks, you opportunity to one

mean explore we I open, continue we're for and to potential Yes. asset always sales. opportunities

them the to However, for deleveraging be are for looking we company.

Can an update esports? on Next give question. . you us

Sure.

Activision the that it As And receive year. by a to shut payment, with that of will is we I And will before, plan to from Al down look reduce we end payment will likely debt. Blizzard. our mentioned

Great.

for the SOI radio EBITDA and Can you station? your question. us Next of tell and Wilmington sale the multiple

Yes.

for IP an a first same able stick Wilmington non-comm all, we time, and broadcaster. we a the the HD value we At were it plus count, top that It channel a sold stream So Philadelphia. million. have move in $X was of to we format side to on sold based to

able continue people be to we'll Philadelphia. type of to and of to Wilmington same provide content the the So

trailing of In a and basis SOI, we Again, million. station sold EBITDA was $X for for on terms full year the EBITDA $XXX,XXX. the about

and revenue total million. non-comm, our a to digital EBITDA, we over -- the $X related station for the agency. million. revenue EBITDA Most $XXX,XXX able we Digital were revenue, revenue the was the of move sold because the to most of was direct Revenue digital to digital $X digital to

looking being on with a based keep multiple EBITDA the that, So at most company. we're within XXx of us able the to

Great.

expect flow be a both for to Next So question. we economic and XXXX? cash XXXX fourth year to you it have cash full year. quarter third and to will for positive XXXX headwinds free flow Do positive quarter, in experienced with free now that be the stretch get full in

of that of and have in However, came review of flow free is XXXX the and cash XXXX? fourth to expectations did you positive a $X.X and approximately $X.X questions. advertising in In XXXX? received are in that we last of what XXXX, $XX advertising XXXX. million and for concludes year-to-date, XXXX, of most in we $XXX,XXX certainly year expecting expect received million. political how full in you political be we our And much political have the have received XXXX XXXX for So million . And the question we is in quarter that, And fourth quarter revenue XXXX. of

Thank much And any Okay. much. free either the with Marie very call for participating today. questions. Thank or you you feel on to myself call very follow-up

you. conclude today's does That Thank teleconference.

disconnect for thank at wonderful this may lines We You and your your day. have a participation you time, today.