Exhibit 99.1

 

SPANISH BROADCASTING SYSTEM, INC. REPORTS

RESULTS FOR THE FOURTH QUARTER AND YEAR END 2018

 

MIAMI, FLORIDA, April 1, 2019 – Spanish Broadcasting System, Inc. (the “Company” or “SBS”) (OTCQB: SBSAA) today reported financial results for the quarter- and year-ended December 31, 2018.

Financial Highlights

 

(in thousands)

 

Quarter Ended

December 31,

 

 

%

 

Year Ended

December 31,

 

 

%

 

 

2018

 

 

2017

 

 

Change

 

2018

 

 

2017

 

 

Change

Net revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Radio

 

$

35,614

 

 

$

30,680

 

 

 

16

%

 

 

$

126,399

 

 

$

119,493

 

 

 

6

%

 

Television

 

 

4,031

 

 

 

5,707

 

 

 

(29

%)

 

 

 

15,970

 

 

 

15,216

 

 

 

5

%

 

Consolidated

 

$

39,645

 

 

$

36,387

 

 

 

9

%

 

 

$

142,369

 

 

$

134,709

 

 

 

6

%

 

Adjusted OIBDA, a non-GAAP measure*:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Radio

 

$

18,172

 

 

$

13,211

 

 

 

38

%

 

 

$

55,713

 

 

$

43,353

 

 

 

29

%

 

Television

 

 

1,568

 

 

 

2,898

 

 

 

(46

%)

 

 

 

4,868

 

 

 

2,566

 

 

 

90

%

 

Corporate

 

 

(2,360

)

 

 

(2,175

)

 

 

(9

)%

 

 

 

(10,496

)

 

 

(9,460

)

 

 

(11

)%

 

Consolidated

 

$

17,380

 

 

$

13,934

 

 

 

25

%

 

 

$

50,085

 

 

$

36,459

 

 

 

37

%

 

Adjusted OIBDA Margins, a non-GAAP measure*:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Radio

 

51%

 

 

43%

 

 

 

 

 

 

 

44%

 

 

36%

 

 

 

 

 

 

Television

 

39%

 

 

51%

 

 

 

 

 

 

 

30%

 

 

17%

 

 

 

 

 

 

Consolidated

 

44%

 

 

38%

 

 

 

 

 

 

 

35%

 

 

27%

 

 

 

 

 

 

* Please refer to the Non-GAAP Financial Measures section for a definition of Adjusted OIBDA and a reconciliation from Adjusted OIBDA to the most directly comparable GAAP financial measure. Certain amounts in the current and prior periods, which consist mostly of severance pay and station relocation costs, have been reclassified from engineering, programming, selling, general and administrative, and corporate expenses to recapitalization costs to conform to the current period’s financial presentation. These changes had no effect on the Company’s results of operations or financial position.

Discussion and Results

“Our fourth quarter and full year 2018 performance represent one of the best operating results in our 35-year history and the true power of our multi-media strategy and leading radio, television, digital and experiential assets,” commented Raúl Alarcón, Chairman and CEO. “Our multi-year effort to transform our company from a traditional broadcaster into an integrated multi-media company is clearly evident in our financial results.

This past year we generated solid top-line growth while also prudently managing our costs, which resulted in consolidated Adjusted OIBDA growth of 37%. We believe this operating margin performance significantly outperformed both our Spanish- and English-language peers. In addition to this industry-leading performance, our audio rankings, as well as our TV, digital and mobile engagement metrics, also grew significantly.”

Mr. Alarcón continued, “We entered 2019 with significant momentum in our business, a strong management team, a clear and unambiguous operating strategy, and a 100% commitment to taking the next critical steps in furthering our business transformation.


 

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Looking ahead, we are focused on building on our successes to date and driving further strong performance in 2019 and beyond. Our key priorities include further integration of our assets, prudently managing our costs and delivering sustainable growth across all our businesses.”

 

Quarter End Results

 

For the quarter-ended December 31, 2018, consolidated net revenue totaled $39.6 million compared to $36.4 million for the same prior year period, resulting in an increase of $3.2 million or 9%.  Our radio segment net revenue increased $4.9 million or 16%, due to increases in local, national, network, barter and digital sales, partially offset by a decrease in special events revenue.  Our television segment net revenue decreased $1.7 million or 29%, primarily from a reduction in subscriber based revenue, partially offset by increases in local and national sales.

 

Consolidated Adjusted OIBDA, a non-GAAP measure, totaled $17.4 million compared to $13.9 million for the same prior year period, representing an increase of $3.5 million or 25%. Our radio segment Adjusted OIBDA increased $5.0 million or 38%, primarily due to the increase in net revenue of $4.9 million and a decrease in operating expenses of $0.1 million.  Radio station operating expenses decreased mainly due to decreases in legal settlements, production costs, professional fees and special event expenses offset by increases in taxes and licenses, sales commissions, and barter expenses.  Our television segment Adjusted OIBDA decreased $1.4 million, due to the decrease in net revenue of $1.7 million, partially offset by a decrease in operating expenses of $0.3 million. Television station operating expenses decreased primarily due to decreases in production costs and taxes and licenses offset by a decrease in production tax credits.  Our corporate expenses, excluding non-cash stock-based compensation, increased $0.2 million or 9%, mostly due to an increase in compensation and benefits.

 

Operating income totaled $14.3 million compared to $14.4 million for the same prior year period, representing a decrease of $0.1 million or less than 1%.  This decrease in operating income was primarily due to having recognized the gain on the sale of spectrum assets in the prior year and current year increases in recapitalization costs and corporate expenses offset by an increase in net revenue and decreases in operating expenses.

Year End Results

 

For the year-ended December 31, 2018, consolidated net revenue totaled $142.4 million compared to $134.7 million for the same prior year period, resulting in an increase of $7.7 million or 6%.  Our radio segment net revenue increased $6.9 million or 6%, due to increases in local, national, network, barter and digital sales which were offset by a decrease in special event revenue.  Our special events revenue decrease occurred primarily in our San Francisco market.  Our television segment net revenue increased $0.8 million or 5%, due to increases in national, local and special events revenue offset by a decrease in subscriber based revenue.

 

Consolidated Adjusted OIBDA, a non-GAAP measure, totaled $50.1 million compared to $36.5 million for the same prior year period, resulting in an increase of $13.6 million or 37%.  Our radio segment Adjusted OIBDA increased $12.3 million or 29%, primarily due to the increase in net revenue of $6.9 million and a decrease in operating expense of $5.4 million.  Radio station operating expenses decreased primarily due to decreases in legal settlements, production and talent costs, and special event expenses offset by increases in commissions and advertising expenses.  Our television segment Adjusted OIBDA increased $2.3 million, due to the decrease in station operating expenses of $1.5 million and the increase in net revenue of $0.8 million.  Television station operating expenses decreased primarily due to decreases in production costs, compensation and benefits, professional fees and facilities expense offset by a decrease in production tax credits and an increase in special events expense.  Our corporate expenses, excluding non-cash stock-based compensation, increased $1.0 million or 11% primarily due to increases in compensation and benefits and professional fees.

 

Operating income totaled $51.6 million compared to $40.5 million for the same prior year period, representing an increase of $11.1 million or 27%.  This increase in operating income was mainly due to the increase in net revenue and decreases in operating expenses and recapitalization costs offset by increases in corporate expenses, an impairment of an FCC broadcasting license and having recognized less gains on the sale of the New York property than were recognized in the prior year for the sale of the Los Angeles facility and spectrum assets.

 

Our Continued Recapitalization and Restructuring Efforts

 

We have not repaid our outstanding 12.5% Senior Secured Notes due 2017 (the “Notes”) since they became due on April 17, 2017, and continue to evaluate all options available to refinance the Notes.  While we assess how to best achieve a successful refinancing of the Notes, we have continued to pay monthly interest on the Notes, payments that a group of investors purporting to own our 10 3/4%


 

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Series B Cumulative Exchangeable Redeemable Preferred Stock (the “Series B preferred stock”) have challenged through the institution of litigation in the Delaware Court of Chancery.  The complaint filed by these investors revealed a purported foreign ownership of our Series B preferred stock, which we are actively addressing, including before the Federal Communications Commission (the “FCC”) in order to protect our broadcast licenses.  Our refinancing efforts have been made more difficult and complex by the Series B preferred stock litigation and foreign ownership issue. We provide more information about each of these items in our Annual Report on Form 10-K for the year ended December 31, 2018.

 

We have worked and continue to work with our advisors regarding a consensual recapitalization or restructuring of our balance sheet, including through the issuance of new debt or equity to raise the necessary funds to repay the Notes.  We believe that the delay in refinancing the Notes has adversely affected us, in that we have been paying substantially more in interest expense on our outstanding Notes than would be the case if we refinanced them in the current market based on the feedback we have received from several financial institutions and potential sources of capital; there is a cloud on title regarding who validly owns our Series B preferred stock, which has created uncertainty as to who owns these shares, and the parties with whom the Company could potentially negotiate a consensual restructuring; we are incurring higher legal costs than otherwise would be the case due to our efforts to resolve the situation in general, to defend ourselves against the Series B preferred stock litigation and to address the foreign ownership issue before the FCC; the trading price of our common stock and preferred stock has been materially adversely affected; our ability to attract interest from investment banks and third party capital suppliers has been materially adversely affected; our reputation has been similarly negatively affected as a general matter despite our diligent efforts to resolve the situation; and the negativity and complexity surrounding our situation has been an unfortunate distraction from our otherwise successful and healthy operating business.  The resolution of the recapitalization or restructuring of our balance sheet, the litigation with the purported holders of our Series B preferred stock and the foreign ownership issue are subject to several factors currently beyond our control.  Our efforts to effect a consensual refinancing of the Notes, the Series B preferred stock litigation and the foreign ownership issue will likely continue to have a material adverse effect on us if they are not successfully resolved.  We face various risks regarding these matters which are summarized in our Annual Report on Form 10-K for the year ended December 31, 2018.

 

 

Fourth Quarter 2018 Conference Call

 

We will host a conference call to discuss our fourth quarter 2018 financial results on Wednesday, April 3, 2019 at 11:00 a.m. Eastern Time.  To access the teleconference, please 412-317-5441 ten minutes prior to the start time

 

If you cannot listen to the teleconference at its scheduled time, there will be a replay available through Tuesday, April 16, 2019 which can be accessed by dialing 877-344-7529 (U.S) or 412-317-0088 (Int’l), passcode: 10129781

 

There will also be a live webcast of the teleconference, located on the investor portion of our corporate Web site, at http://www.spanishbroadcasting.com/webcasts-presentations. A seven day archived replay of the webcast will also be available at that link. 

About Spanish Broadcasting System, Inc.

Spanish Broadcasting System, Inc. (SBS) owns and operates radio stations located in the top U.S. Hispanic markets of New York, Los Angeles, Miami, Chicago, San Francisco and Puerto Rico, airing the Tropical, Regional Mexican, Spanish Adult Contemporary, Top 40 and Urbano format genres. SBS also operates AIRE Radio Networks, a national radio platform of over 250 affiliated stations reaching 94% of the U.S. Hispanic audience.  SBS also owns MegaTV, a network television operation with over-the-air, cable and satellite distribution and affiliates throughout the U.S. and Puerto Rico, produces a nationwide roster of live concerts and events, and owns a stable of digital properties, including La Musica, a mobile app providing Latino-focused audio and video streaming content and HitzMaker, a new-talent destination for aspiring artists. For more information, visit us online at www.spanishbroadcasting.com.

Forward Looking Statements

This press release, and oral statements made in connection with it, contains certain forward-looking statements.  These forward-looking statements, which are included in accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, may involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results and performance in future periods to be materially different from any future results or performance suggested by the forward-looking statements in this press release.  Although we believe the expectations reflected in such forward-looking statements are based upon reasonable assumptions, we can give no assurance that actual results will not differ materially from these expectations.  “Forward-looking” statements, as such term is defined by the Securities Exchange Commission in its rules, regulations and releases, represent our expectations or beliefs, including, but not limited to, statements concerning our operations, economic performance, financial


 

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condition, our recapitalization plan, growth and acquisition strategies, investments and future operational plans.  Without limiting the generality of the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “forecast,” “seek,” “plan,” “predict,” “project,” “could,” “estimate,” “might,” “continue,” “seeking” or the negative or other variations thereof or comparable terminology are intended to identify forward-looking statements.  These statements, by their nature, involve substantial risks and uncertainties, certain of which are beyond our control, and actual results may differ materially depending on a variety of important factors, including, but not limited to, those identified in our reports filed with the Securities and Exchange Commission including our Annual Report on Form 10-K for the year ended December 31, 2018.  All forward-looking statements made herein are qualified by these cautionary statements and risk factors and there can be no assurance that the actual results, events or developments referenced herein will occur or be realized. We undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results.

 

(Financial Table Follows)

 

 

Contacts:

 

 

Analysts and Investors

 

Analysts, Investors or Media

José I. Molina

 

Brad Edwards

Chief Financial Officer

 

The Plunkett Group

(305) 441-6901

 

(212) 739-6740

 


 

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Below are the Unaudited Condensed Consolidated Statements of Operations for the quarter- and year-ended December 31, 2018 and 2017.

 

 

Quarter Ended

December 31,

 

 

Year Ended

December 31,

 

Amounts in thousands, except per share amounts

 

2018

 

 

2017

 

 

2018

 

 

2017

 

 

 

(Unaudited)

 

 

(Unaudited)

 

Net revenue

 

$

39,645

 

 

$

36,387

 

 

$

142,369

 

 

$

134,709

 

Station operating expenses*

 

 

19,905

 

 

 

20,278

 

 

 

81,788

 

 

 

88,790

 

Corporate expenses*

 

 

2,365

 

 

 

2,187

 

 

 

10,540

 

 

 

9,608

 

Depreciation and amortization

 

 

895

 

 

 

1,019

 

 

 

3,801

 

 

 

4,349

 

Loss (gain) on the disposal of assets, net

 

 

171

 

 

 

(3,067

)

 

 

(12,550

)

 

 

(15,894

)

Recapitalization costs*

 

 

1,986

 

 

 

1,527

 

 

 

6,713

 

 

 

7,326

 

Impairment charges

 

 

 

 

 

 

 

 

483

 

 

 

 

Other operating income

 

 

 

 

 

(3

)

 

 

 

 

 

(3

)

Operating income

 

 

14,323

 

 

 

14,446

 

 

 

51,594

 

 

 

40,533

 

Interest expense

 

 

(7,849

)

 

 

(8,151

)

 

 

(31,862

)

 

 

(35,850

)

Dividends on Series B preferred stock classified as interest

   expense

 

 

(2,433

)

 

 

(2,433

)

 

 

(9,734

)

 

 

(9,733

)

Interest income

 

 

22

 

 

 

13

 

 

 

22

 

 

 

13

 

Income (loss) before income tax benefit

 

 

4,063

 

 

 

3,875

 

 

 

10,020

 

 

 

(5,037

)

Income tax benefit

 

 

(9,130

)

 

 

(31,103

)

 

 

(6,471

)

 

 

(24,658

)

Net income

 

$

13,193

 

 

$

34,978

 

 

$

16,491

 

 

$

19,621

 

Net income per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted net income per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Class A common stock

 

$

1.80

 

 

$

4.81

 

 

$

2.25

 

 

$

2.70

 

Class B common stock

 

$

1.80

 

 

$

4.81

 

 

$

2.25

 

 

$

2.70

 

Basic weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Class A common stock

 

 

4,242

 

 

 

4,167

 

 

 

4,224

 

 

 

4,167

 

Class B common stock

 

 

2,340

 

 

 

2,340

 

 

 

2,340

 

 

 

2,340

 

Diluted weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Class A common stock

 

 

4,242

 

 

 

4,167

 

 

 

4,224

 

 

 

4,167

 

Class B common stock

 

 

2,340

 

 

 

2,340

 

 

 

2,340

 

 

 

2,340

 

 

* Certain amounts in the current and prior periods, which consist mostly of severance pay and station relocation costs, have been reclassified from engineering, programming, selling, general and administrative, and corporate expenses to recapitalization costs to conform to the current period’s financial presentation. These changes had no effect to the Company’s results of operations or financial position.

 


 

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Non-GAAP Financial Measures

Adjusted Operating Income (Loss) before Depreciation and Amortization, (Gain) Loss on the Disposal of Assets, net, Recapitalization Costs, Impairment Charges and Other Operating Income excluding non-cash stock-based compensation (“Adjusted OIBDA”) is not a measure of performance or liquidity determined in accordance with Generally Accepted Accounting Principles (“GAAP”) in the United States.  However, we believe that this measure is useful in evaluating our performance because it reflects a measure of performance for our stations before considering costs and expenses related to our capital structure and dispositions.  This measure is widely used in the broadcast industry to evaluate a company’s operating performance and is used by us for internal budgeting purposes and to evaluate the performance of our stations, segments, management and consolidated operations.  However, this measure should not be considered in isolation or as a substitute for Operating Income, Net Income, Cash Flows from Operating Activities or any other measure used in determining our operating performance or liquidity that is calculated in accordance with GAAP.  Adjusted OIBDA does not present station operating income as defined by our Indenture governing the Notes.  In addition, because Adjusted OIBDA is not calculated in accordance with GAAP, it is not necessarily comparable to similarly titled measures used by other companies.  

Included below are tables that reconcile Adjusted OIBDA to operating income (loss) for each segment and consolidated operating income (loss), which is the most directly comparable GAAP financial measure.

 

 

Quarter Ended December 31, 2018

 

(Unaudited and in thousands)

 

Consolidated

 

 

Radio

 

 

Television

 

 

Corporate

 

Adjusted OIBDA

 

$

17,380

 

 

 

18,172

 

 

 

1,568

 

 

 

(2,360

)

Less expenses excluded from Adjusted OIBDA but included in operating income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation

 

 

5

 

 

 

 

 

 

 

 

 

5

 

Depreciation and amortization

 

 

895

 

 

 

403

 

 

 

434

 

 

 

58

 

Loss (gain) on the disposal of assets, net

 

 

171

 

 

 

168

 

 

 

3

 

 

 

 

Recapitalization costs

 

 

1,986

 

 

 

 

 

 

 

 

 

1,986

 

Other operating gains

 

 

 

 

 

 

 

 

 

 

 

 

Other operating income

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income (Loss)

 

$

14,323

 

 

 

17,601

 

 

 

1,131

 

 

 

(4,409

)

 

 

Quarter Ended December 31, 2017

 

(Unaudited and in thousands)

 

Consolidated

 

 

Radio

 

 

Television

 

 

Corporate

 

Adjusted OIBDA

 

$

13,934

 

 

 

13,211

 

 

 

2,898

 

 

 

(2,175

)

Less expenses excluded from Adjusted OIBDA but included in operating income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation

 

 

12

 

 

 

 

 

 

 

 

 

12

 

Depreciation and amortization

 

 

1,019

 

 

 

445

 

 

 

543

 

 

 

31

 

Loss (gain) on the disposal of assets, net

 

 

(3,067

)

 

 

268

 

 

 

(3,318

)

 

 

(17

)

Recapitalization costs*

 

 

1,527

 

 

 

 

 

 

 

 

 

1,527

 

Other operating gains

 

 

 

 

 

 

 

 

 

 

 

 

Other operating income

 

 

(3

)

 

 

 

 

 

 

 

 

(3

)

Operating Income (Loss)

 

$

14,446

 

 

 

12,498

 

 

 

5,673

 

 

 

(3,725

)

 

 

Year Ended December 31, 2018

 

(Unaudited and in thousands)

 

Consolidated

 

 

Radio

 

 

Television

 

 

Corporate

 

Adjusted OIBDA

 

$

50,085

 

 

 

55,713

 

 

 

4,868

 

 

 

(10,496

)

Less expenses excluded from Adjusted OIBDA but included in operating income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation

 

 

44

 

 

 

 

 

 

 

 

 

44

 

Depreciation and amortization

 

 

3,801

 

 

 

1,659

 

 

 

1,907

 

 

 

235

 

Gain on the disposal of assets, net

 

 

(12,550

)

 

 

(3

)

 

 

(6

)

 

 

(12,541

)

Recapitalization costs

 

 

6,713

 

 

 

 

 

 

 

 

 

6,713

 

Impairment

 

 

483

 

 

 

 

 

 

483

 

 

 

 

Other operating income

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income (Loss)

 

$

51,594

 

 

 

54,057

 

 

 

2,484

 

 

 

(4,947

)


 

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Year Ended December 31, 2017

 

(Unaudited and in thousands)

 

Consolidated

 

 

Radio

 

 

Television

 

 

Corporate

 

Adjusted OIBDA

 

$

36,459

 

 

 

43,353

 

 

 

2,566

 

 

 

(9,460

)

Less expenses excluded from Adjusted OIBDA but included in operating income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation

 

 

148

 

 

 

 

 

 

 

 

 

148

 

Depreciation and amortization

 

 

4,349

 

 

 

1,834

 

 

 

2,218

 

 

 

297

 

Gain on the disposal of assets, net

 

 

(15,894

)

 

 

(12,558

)

 

 

(3,319

)

 

 

(17

)

Recapitalization costs*

 

 

7,326

 

 

 

 

 

 

 

 

 

7,326

 

Impairment

 

 

 

 

 

 

 

 

 

 

 

 

Other operating income

 

 

(3

)

 

 

 

 

 

 

 

 

(3

)

Operating Income (Loss)

 

$

40,533

 

 

 

54,077

 

 

 

3,667

 

 

 

(17,211

)

 

* Certain amounts in the current and prior periods, which consist mostly of severance pay and station relocation costs, have been reclassified from engineering, programming, selling, general and administrative, and corporate expenses to recapitalization costs to conform to the current period’s financial presentation. These changes had no effect to the Company’s results of operations or financial position.

 

Non-GAAP Reporting Requirement under our Senior Secured Notes Indenture

Under the Indenture, we are to provide our Noteholders a statement of our “Station Operating Income for the Television Segment,” as defined by the Indenture, for the twelve-month period ended December 31, 2018 and 2017, and a reconciliation of “Station Operating Income for the Television Segment” to the most directly comparable financial measure calculated in accordance with GAAP.  In addition, we are to provide our “Secured Leverage Ratio,” as defined by the Indenture, as of December 31, 2018.

Included below is the table that reconciles “Station Operating Income for the Television Segment” to the most directly comparable GAAP financial measure. Also included is our “Secured Leverage Ratio” as of December 31, 2018.

 

 

Twelve-Months Ended

 

 

Quarters Ended

 

 

 

December 31,

 

 

Dec. 31,

 

 

Sept. 30,

 

 

June 30,

 

 

March 31,

 

(Unaudited and in thousands)

 

2018

 

 

2018

 

 

2018

 

 

2018

 

 

2018 *

 

Station Operating Income (Loss) for the Television

   Segment, as defined by the Indenture

 

$

4,925

 

 

 

1,647

 

 

 

1,471

 

 

 

1,064

 

 

 

743

 

Less expenses excluded from Station Operating Income

   for the Television Segment, as defined by the Indenture,

   but included in operating income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

1,907

 

 

 

434

 

 

 

432

 

 

 

504

 

 

 

537

 

Gain on the disposal of assets, net

 

 

(6

)

 

 

3

 

 

 

29

 

 

 

(38

)

 

 

 

Impairment charges

 

 

483

 

 

 

 

 

 

 

 

 

483

 

 

 

 

Non-cash barter (income) expense

 

 

57

 

 

 

79

 

 

 

6

 

 

 

(21

)

 

 

(7

)

Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP Operating Income (Loss) for the Television Segment

 

$

2,484

 

 

 

1,131

 

 

 

1,004

 

 

 

136

 

 

 

213

 


 

Spanish Broadcasting System, Inc.

Page 8

 

 

 

Twelve-Months Ended

 

 

Quarters Ended

 

 

 

December 31,

 

 

Dec. 31,

 

 

Sept. 30,

 

 

June 30,

 

 

March 31,

 

 

 

2017

 

 

2017

 

 

2017

 

 

2017

 

 

2017

 

Station Operating Income (Loss) for the Television

   Segment, as defined by the Indenture

 

$

2,520

 

 

 

2,822

 

 

 

179

 

 

 

196

 

 

 

(677

)

Less expenses excluded from Station Operating Income

   for the Television Segment, as defined by the Indenture,

   but included in operating income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

2,218

 

 

 

543

 

 

 

557

 

 

 

559

 

 

 

559

 

Gain on the disposal of assets, net

 

 

(3,319

)

 

 

(3,318

)

 

 

 

 

 

 

 

 

(1

)

Impairment charges

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-cash barter (income) expense

 

 

(53

)

 

 

(76

)

 

 

(6

)

 

 

64

 

 

 

(35

)

Other

 

 

7

 

 

 

 

 

 

(1

)

 

 

7

 

 

 

1

 

GAAP Operating Income (Loss) for the Television Segment

 

$

3,667

 

 

 

5,673

 

 

 

(371

)

 

 

(434

)

 

 

(1,201

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of December 31, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Secured Leverage Ratio, as defined by the Indenture

 

 

5.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

* Certain amounts in the current and prior periods, which consist mostly of severance pay and station relocation costs, have been reclassified from engineering, programming, selling, general and administrative, and corporate expenses to recapitalization costs to conform to the current period’s financial presentation. These changes had no effect to the Company’s results of operations or financial position.

 


 

Spanish Broadcasting System, Inc.

Page 9

 

Unaudited Segment Data

We have two reportable segments: radio and television.  The following summary table presents separate financial data for each of our operating segments:

 

 

Quarter Ended

December 31,

 

 

Year Ended

December 31,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

 

 

(In thousands)

 

 

(In thousands)

 

Net revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Radio

 

$

35,614

 

 

$

30,680

 

 

$

126,399

 

 

$

119,493

 

Television

 

 

4,031

 

 

 

5,707

 

 

 

15,970

 

 

 

15,216

 

Consolidated

 

$

39,645

 

 

$

36,387

 

 

$

142,369

 

 

$

134,709

 

Engineering and programming expenses*:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Radio

 

$

5,085

 

 

$

6,175

 

 

$

21,101

 

 

$

23,542

 

Television

 

 

1,306

 

 

 

1,503

 

 

 

4,715

 

 

 

6,932

 

Consolidated

 

$

6,391

 

 

$

7,678

 

 

$

25,816

 

 

$

30,474

 

Selling, general and administrative expenses*:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Radio

 

$

12,357

 

 

$

11,294

 

 

$

49,585

 

 

$

52,598

 

Television

 

 

1,157

 

 

 

1,306

 

 

 

6,387

 

 

 

5,718

 

Consolidated

 

$

13,514

 

 

$

12,600

 

 

$

55,972

 

 

$

58,316

 

Corporate expenses*:

 

$

2,365

 

 

$

2,187

 

 

$

10,540

 

 

$

9,608

 

Depreciation and amortization:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Radio

 

$

403

 

 

$

445

 

 

$

1,659

 

 

$

1,834

 

Television

 

 

434

 

 

 

543

 

 

 

1,907

 

 

 

2,218

 

Corporate

 

 

58

 

 

 

31

 

 

 

235

 

 

 

297

 

Consolidated

 

$

895

 

 

$

1,019

 

 

$

3,801

 

 

$

4,349

 

Loss (gain) on the disposal of assets, net:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Radio

 

$

168

 

 

$

268

 

 

$

(3

)

 

$

(12,558

)

Television

 

 

3

 

 

 

(3,318

)

 

 

(6

)

 

 

(3,319

)

Corporate

 

 

 

 

 

(17

)

 

 

(12,541

)

 

 

(17

)

Consolidated

 

$

171

 

 

$

(3,067

)

 

$

(12,550

)

 

$

(15,894

)

Recapitalization costs*:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Radio

 

$

 

 

$

 

 

$