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IMMEDIATE RELEASE

TOWNSQUARE REPORTS FOURTH QUARTER AND FULL YEAR 2017 RESULTS
ANNOUNCES $0.075 DIVIDEND PER SHARE

Greenwich, CT - March 13, 2018 - Townsquare Media, Inc. (NYSE: TSQ) (“Townsquare,” the “Company,” “we,” “us,” or “our”) announced today financial results for the fourth quarter and year ended December 31, 2017.

“We are pleased to announce another strong result in our Local Marketing Solutions segment, which delivered net revenue growth of 0.4% in the fourth quarter of 2017, and 1.9% for the full year, despite the loss of political revenue.  This was the 16th consecutive quarter of positive, organic net revenue growth for this segment of our Company.  Excluding political revenue, Local Marketing Solutions net revenue increased 5.2% in the fourth quarter of 2017, our strongest quarter of the year, and 3.9% for the full year,” commented Bill Wilson, Co-Chief Executive Officer of Townsquare.

The Company also announced today that its Board of Directors approved the initiation of a quarterly cash dividend of $0.075 per share. The dividend will be payable on May 15, 2018 to shareholders of record as of the close of business on April 2, 2018.

“The Board’s decision to approve a dividend reflects confidence in our current capitalization, the strength of our balance sheet, our free cash flow generation, and our outlook for 2018,” commented Dhruv Prasad, Co-Chief Executive Officer of Townsquare. “Our quarterly cash dividend of $0.075 per share, or $0.30 per share on an annual basis, commences in May 2018.”

Fourth Quarter Highlights*
As compared to the fourth quarter of 2016 on an actual basis:
Local Marketing Solutions net revenue increased 0.4%, and 5.2% excluding political revenue
Entertainment net revenue decreased 17.4%
Net revenue decreased 3.7%, and 0.2% excluding political revenue
Net income from continuing operations decreased 941.5%
Adjusted EBITDA decreased 12.7%, to $21.6 million, consistent with previously issued guidance
Diluted net loss per share from continuing operations and diluted Adjusted Net Income Per Share were $(1.42) and $0.14, respectively

Full Year Highlights*
As compared to the year ended December 31, 2016 on an actual basis:
Local Marketing Solutions net revenue increased 1.9%, and 3.9% excluding political revenue
Entertainment net revenue decreased 8.6%
Net revenue decreased 1.7%, and 0.4% excluding political revenue
Net income from continuing operations decreased 138.3%
Adjusted EBITDA decreased 8.8%, to $97.2 million, consistent with previously issued guidance
Diluted net loss per share from continuing operations and diluted Adjusted Net Income Per Share were $(0.48) and $0.74, respectively
Repaid $6.7 million of long-term debt

* See below for discussion of non-GAAP measures and reconciliations to GAAP measures.

1




Segment Reporting
We have two reportable segments, Local Marketing Solutions, which provides broadcast and digital products and solutions to advertisers and businesses within our local markets, and Entertainment, which provides live event experiences and music and lifestyle content directly to consumers, and promotion, advertising and product activations to local and national advertisers.

Quarter Ended December 31, 2017 Compared to the Quarter Ended December 31, 2016

Net Revenue
Net revenue for the quarter ended December 31, 2017 decreased $4.4 million, or 3.7%, to $114.3 million, as compared to $118.7 million in the same period last year. Local Marketing Solutions net revenue increased $0.4 million, or 0.4%, to $91.6 million and Entertainment net revenue decreased $4.8 million, or 17.4%, to $22.6 million, due to revenue declines in certain of our live events and in our national digital business. Excluding political revenue, net revenue decreased $0.3 million, or 0.2%, to $113.1 million and Local Marketing Solutions net revenue increased $4.5 million, or 5.2%, to $90.5 million.

Net (Loss) Income
Net (loss) income for the quarter ended December 31, 2017 decreased $30.3 million, or 944.1%, to a net loss of $27.1 million, as compared to net income of $3.2 million in the same period last year. Net (loss) income from continuing operations for the quarter ended December 31, 2017 decreased $29.4 million, or 941.5%, to a net loss of $26.3 million, as compared to net income of $3.1 million in the same period last year. Net (loss) income and net (loss) income from continuing operations declined primarily due to a $51.8 million impairment charge recorded in the quarter ended December 31, 2017.

Adjusted EBITDA
Adjusted EBITDA for the quarter ended December 31, 2017 decreased $3.1 million, or 12.7%, to $21.6 million, as compared to $24.8 million in the same period last year.

Year Ended December 31, 2017 Compared to the Year Ended December 31, 2016

Net Revenue
Net revenue for the year ended December 31, 2017 decreased $8.6 million, or 1.7%, to $507.4 million, as compared to $516.0 million in the same period last year. Local Marketing Solutions net revenue increased $6.5 million or 1.9%, to $348.7 million and Entertainment net revenue decreased $15.0 million or 8.6%, to $158.8 million, due to revenue declines in certain of our live events and in our national digital business. Excluding political revenue, net revenue decreased $2.0 million, or 0.4%, to $505.0 million and Local Marketing Solutions net revenue increased $13.1 million, or 3.9%, to $346.2 million.

Net (Loss) Income
Net (loss) income for the year ended December 31, 2017 decreased $33.6 million, or 144.1%, to a net loss of $10.3 million, as compared to net income of $23.3 million in the same period last year. Net (loss) income from continuing operations for the year ended December 31, 2017 decreased $32.1 million, or 138.3%, to a net loss of $8.9 million, as compared to net income of $23.2 million in the same period last year. Net (loss) income and net (loss) income from continuing operations declined primarily due to a $51.8 million impairment charge recorded in the quarter ended December 31, 2017.

Adjusted EBITDA
Adjusted EBITDA for the year ended December 31, 2017 decreased $9.4 million, or 8.8%, to $97.2 million, as compared to $106.6 million in the same period last year.



2





Liquidity and Capital Resources
As of December 31, 2017, we had a total of $65.3 million of cash on hand and $50.0 million of available borrowing capacity under our revolving credit facility. As of December 31, 2017, we had $571.9 million of outstanding indebtedness, representing 5.9x and 5.2x gross and net leverage, respectively, based on Adjusted EBITDA for the year ended December 31, 2017 of $97.2 million.

The table below presents a summary, as of March 10, 2018, of our outstanding common stock and securities convertible into common stock, excluding options issued under our 2014 Omnibus Incentive Plan.

Security
 
Number Outstanding1
Description
Class A common stock
 
13,837,676
One vote per share.
Class B common stock
 
3,022,484
10 votes per share.2
Class C common stock
 
1,636,341
No votes.2
Warrants
 
8,977,676
Each warrant is exercisable for one share of Class A common stock, at an exercise price of $0.0001 per share. The aggregate exercise price for all warrants currently outstanding is $898.3
Total
 
27,474,177
 
 
 
 
 
1  Each of the shares of common stock listed below, including the shares of Class A common stock issuable upon exercise of the warrants, has equal economic rights.
2  Each share converts into 1 share of Class A common stock upon transfer or at the option of the holder, subject to certain conditions, including compliance with FCC rules.
3 The warrants are fully vested and exercisable for shares of Class A common stock, subject to certain conditions, including compliance with FCC rules.

Conference Call
Townsquare Media, Inc. will host a conference call to discuss certain fourth quarter and full year 2017 financial results on Tuesday, March 13, 2018 at 8:00 a.m. Eastern Time. The conference call dial-in number is 1-877-407-0784 (U.S. & Canada) or 1-201-689-8560 (International) and the confirmation code is 13675865. A live webcast of the conference call will also be available on the equity investor relations page of the Company’s website at www.townsquaremedia.com.

A replay of the conference call will be available through March 20, 2018. To access the replay, please dial 1-844-512-2921 (U.S. & Canada) or 1-412-317-6671 (International) and enter confirmation code 13675865. A web-based archive of the conference call will also be available at the above website for thirty days after the call.

About Townsquare Media, Inc.
Townsquare is a radio, digital media, entertainment and digital marketing solutions company principally focused on being the premier local advertising and marketing solutions platform in small and mid-sized markets across the U.S. Our assets include 317 radio stations and more than 325 local websites in 67 U.S. markets, a digital marketing solutions company (Townsquare Interactive) serving approximately 12,400 small to medium sized businesses, a proprietary digital programmatic advertising platform (Townsquare Ignite) and approximately 350 live events with nearly 18 million attendees each year in the U.S. and Canada. Our brands include local media assets such as WYRK, KLAQ, K2 and NJ101.5; music festivals such as Mountain Jam, WE Fest and the Taste of Country Music Festival; touring lifestyle and entertainment events such as the America on Tap craft beer festival series and North American Midway Entertainment, North America’s largest mobile amusement company; and leading tastemaker music and entertainment owned and affiliated websites such as XXLmag.com, TasteofCountry.com and Loudwire.com. For more information, please visit www.townsquaremedia.com, www.townsquareinteractive.com, and www.townsquareignite.com.

3




Forward-Looking Statements
Except for the historical information contained in this press release, the matters addressed are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements often discuss our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “aim,” “anticipate,” “estimate,” “expect,” “forecast,” “outlook,” “potential,” “project,” “projection,” “plan,” “intend,” “seek,” “believe,” “may,” “could,” “would,” “will,” “should,” “can,” “can have,” “likely,” the negatives thereof and other words and terms. By nature, forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statement. Forward-looking statements are based on current expectations and assumptions and currently available data and are neither predictions nor guarantees of future events or performance. You should not place undue reliance on forward-looking statements, which speak only as of the date hereof. See “Risk Factors” and “Forward-Looking Statements” included in our Annual Report on Form 10-K for the year ended December 31, 2017, filed with the Securities and Exchange Commission on or about the date hereof, for a discussion of factors that could cause our actual results to differ from those expressed or implied by forward-looking statements. Townsquare Media, Inc. assumes no responsibility to update any forward-looking statement as a result of new information, future events or otherwise, except as required by law.

Non-GAAP Financial Measures and Definitions
In this press release, we refer to Adjusted EBITDA, Adjusted EBITDA Less Interest, Capex and Taxes, Adjusted Net Income, Adjusted Net Income Per Share and Adjusted Segment Operating Income which are financial measures that have not been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”).

We define Adjusted EBITDA as net (loss) income before the deduction of income taxes, other expense (income) net, interest expense, net, repurchase of debt, transaction costs, stock-based compensation, net loss (gain) on sale and retirement of assets, business realignment costs, goodwill and other intangible impairment charges, net (loss) income on discontinued operations, net of income taxes, impairment of investment and depreciation and amortization. Adjusted EBITDA Less Interest, Capex and Taxes is defined as Adjusted EBITDA less net cash interest expense, capital expenditures and cash paid for taxes. Adjusted Net Income is defined as net (loss) income before the deduction of income taxes, transaction costs, business realignment costs, impairment of investment, goodwill and other intangible impairment charges, one-time stock option repricing, net loss (gain) on sale and retirement of assets, repurchase of debt and net (loss) income from discontinued operations, net of income taxes. Adjusted Net Income Per Share is defined as Adjusted Net Income divided by the weighted average shares outstanding. Adjusted Segment Operating Income is defined as segment operating income before the deduction of depreciation and amortization, stock-based compensation, business realignment costs and goodwill and other intangible impairment charges. These measures do not represent, and should not be considered as alternatives to, net income (loss), segment operating income or cash flows from operations, as determined under GAAP. In addition, these non-GAAP measures may not be comparable to similarly-named measures reported by other companies. Reconciliations of these non-GAAP measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are set forth in the tables below.

We use Adjusted EBITDA to facilitate company-to-company operating performance comparisons by backing out potential differences caused by variations in capital structures (affecting interest expense), taxation and the age and book depreciation of facilities and equipment (affecting relative depreciation expense), which may vary for different companies for reasons unrelated to operating performance. We use Adjusted Net Income and Adjusted Net Income Per Share to assess total company operating performance on a consistent basis. We use Adjusted Segment Operating Income to evaluate the operating performance of our business segments. We believe that these measures, when considered together with our GAAP financial results, provide management and investors with a more complete understanding of our business operating results, including underlying trends, by excluding the effects of transaction costs, net loss (gain) on sale and retirement of assets, repurchase of debt, business realignment costs, certain impairments, a one-time stock option repricing and net (loss) income from discontinued operations. Further, while discretionary bonuses for members of management are not determined with reference to specific targets, our Board of Directors may consider Adjusted EBITDA, Adjusted EBITDA Less Interest, Capex and Taxes, Adjusted Net Income, Adjusted Net Income Per Share and Adjusted Segment Operating Income when determining discretionary bonuses.


Investor Relations
Claire Yenicay
(203) 900-5555
investors@townsquaremedia.com



4




TOWNSQUARE MEDIA, INC.
CONSOLIDATED BALANCE SHEETS
(in Thousands, Except Share and Per Share Data)
 
December 31,
2017
 
December 31,
2016
ASSETS
 
 
 
Current assets:
 
 
 
Cash
$
65,295

 
$
51,540

Accounts receivable, net of allowance of $1,079 and $1,433, respectively
61,659

 
59,580

Prepaid expenses and other current assets
10,471

 
11,253

 Current assets held for sale
879

 

    Current assets of discontinued operations
100

 
254

Total current assets
138,404

 
122,627

 
 
 
 
Property and equipment, net
146,992

 
139,408

Intangible assets, net
508,399

 
513,915

Goodwill
243,042

 
292,953

Investments
8,092

 
4,313

Other assets
10,998

 
7,290

Long-term assets of discontinued operations
431

 

Long-term assets held for sale

 
199

Total assets
$
1,056,358

 
$
1,080,705

 
 
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
Current liabilities:
 
 
 
Accounts payable
$
14,559

 
$
10,602

Current portion of long-term debt
9,524

 
6,901

Deferred revenue
17,683

 
17,208

Accrued expenses and other current liabilities
25,160

 
25,748

Accrued interest
5,699

 
4,622

    Current liabilities of discontinued operations
680

 
71

Total current liabilities
73,305

 
65,152

Long-term debt, less current portion (net of deferred financing costs of $6,803 and $8,006, respectively)
555,618

 
564,315

Deferred tax liability
36,965

 
50,907

Other long-term liabilities
9,390

 
10,221

Long-term liabilities of discontinued operations

 
59

Total liabilities
675,278

 
690,654

 
 
 
 
Stockholders’ equity:
 
 
 
Class A common stock, par value $0.01 per share; 300,000,000 shares authorized; 13,819,639 and 13,735,690 shares issued and outstanding, respectively
138

 
137

Class B common stock, par value $0.01 per share; 50,000,000 shares authorized; 3,022,484 shares issued and outstanding
30

 
30

Class C common stock, par value $0.01 per share; 50,000,000 shares authorized; 1,636,341 shares issued and outstanding
17

 
17

    Total common stock
185

 
184

    Additional paid-in capital
367,041

 
365,434

    Retained earnings
13,265

 
24,450

    Accumulated other comprehensive loss
(532
)
 
(722
)
    Noncontrolling interest
1,121

 
705

Total stockholders’ equity
381,080

 
390,051

Total liabilities and stockholders’ equity
$
1,056,358

 
$
1,080,705



5




TOWNSQUARE MEDIA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in Thousands, Except Per Share Data)
 
Three Months Ended December 31,
 
Years Ended December 31,
 
2017
 
2016
 
2017
 
2016
 
 
 
 
 
 
 
 
Net revenue
$
114,255

 
$
118,650

 
$
507,434

 
$
515,995

 
 
 
 
 
 
 
 
Operating costs and expenses:
 
 
 
 
 
 
 
Direct operating expenses, excluding depreciation, amortization and stock-based compensation
85,183

 
86,850

 
384,412

 
383,994

Depreciation and amortization
5,935

 
6,159

 
25,683

 
23,971

Corporate expenses
7,453

 
7,050

 
25,828

 
25,370

Stock-based compensation
177

 
3,590

 
748

 
4,253

Transaction costs
569

 
238

 
1,175

 
844

Business realignment costs
6,204

 

 
6,204

 

Goodwill and other intangible impairment charges
51,848

 

 
51,848

 

Net (gain) loss on sale and retirement of assets
(265
)
 
(5
)
 
397

 
282

    Total operating costs and expenses
157,104

 
103,882

 
496,295

 
438,714

    Operating (loss) income
(42,849
)
 
14,768

 
11,139

 
77,281

 
 
 
 
 
 
 
 
Other expense (income):
 
 
 
 
 
 
 
Interest expense, net
8,279

 
8,332

 
32,753

 
34,072

Impairment on investment

 

 

 
4,236

Repurchase of debt

 
(85
)
 

 
(546
)
Other expense (income), net
99

 
(312
)
 
288

 
(665
)
     (Loss) income from continuing operations before income taxes
(51,227
)
 
6,833

 
(21,902
)
 
40,184

     (Benefit) provision for income taxes
(24,956
)
 
3,713

 
(13,027
)
 
16,982

Net (loss) income from continuing operations
(26,271
)
 
3,120

 
(8,875
)
 
23,202

      Net (loss) income from discontinued operations, net of income taxes
(850
)
 
91

 
(1,398
)
 
91

     Net (loss) income
$
(27,121
)
 
$
3,211

 
$
(10,273
)
 
$
23,293

 
 
 
 
 
 
 
 
Net (loss) income attributable to:
 
 
 
 
 
 
 
     Controlling interests
$
(27,494
)
 
$
3,234

 
$
(11,185
)
 
$
23,059

     Non-controlling interests
373

 
(23
)
 
912

 
234

 
 
 
 
 
 
 
 
Basic (loss) income per share:
 
 
 
 
 
 
 
Continuing operations
$
(1.42
)
 
$
0.17

 
$
(0.48
)
 
$
1.28

Discontinued operations
(0.05
)
 

 
(0.08
)
 

 
$
(1.47
)
 
$
0.17

 
$
(0.56
)
 
$
1.28

 
 
 
 
 
 
 
 
Diluted (loss) income per share:
 
 
 
 
 
 
 
Continuing operations
$
(1.42
)
 
$
0.12

 
$
(0.48
)
 
$
0.85

Discontinued operations
(0.05)
 

 
(0.08
)
 

 
$
(1.47
)
 
$
0.12

 
$
(0.56
)
 
$
0.85

 
 
 
 
 
 
 
 
Weighted average shares outstanding:
 
 
 
 
 
 
 
     Basic
18,478

 
18,395

 
18,459

 
18,255

     Diluted
18,478

 
27,419

 
18,459

 
27,313




6




TOWNSQUARE MEDIA, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in Thousands)
 
Year Ended December 31,
 
2017
 
2016
Cash flows from operating activities:
 
 
 
Net (loss) income attributable to:
 
 
 
Controlling interests
$
(11,185
)
 
$
23,059

Noncontrolling interests
912

 
234

Net (loss) income
$
(10,273
)
 
$
23,293

Adjustments to reconcile net (loss) income to net cash from operating activities:
 
 
 
Depreciation and amortization
25,683

 
23,971

Amortization of deferred financing costs
1,646

 
1,579

Deferred income tax (benefit) expense
(13,806
)
 
15,831

Provision for doubtful accounts
2,186

 
1,921

Stock-based compensation expense
748

 
4,253

Trade activity, net
(11,754
)
 
(9,731
)
Repurchase of debt

 
(546
)
Write-off deferred financing costs
83

 
376

   Impairment of goodwill
48,933

 

Impairment of FCC licenses
2,915

 

Write-off of goodwill
4,105

 

Write-off of trademark
771

 

Impairment on investment

 
4,236

Net loss on sale and retirement of assets
397

 
282

Changes in assets and liabilities, net of acquisitions:
 
 
 
Accounts receivable
(864
)
 
3,987

Prepaid expenses and other assets
(676
)
 
(704
)
Accounts payable
669

 
(2,463
)
Accrued expenses
(625
)
 
(5,002
)
Accrued interest
1,107

 
(288
)
Other long-term liabilities
(835
)
 
(1,074
)
Net cash provided by operating activities - continuing operations
50,410

 
59,921

Net cash provided by (used in) operating activities - discontinued operations
274

 
(124
)
Net cash provided by operating activities
50,684

 
59,797

Cash flows from investing activities:
 
 
 
   Payments for acquisitions, net of cash received
(5,511
)
 
(2,160
)
   Payment for investment
(857
)
 

   Acquisition of intangibles
(150
)
 
(11
)
   Purchase of property and equipment
(22,824
)
 
(20,722
)
   Proceeds from insurance settlement

 
451

   Proceeds from sale of assets
1,092

 
1,678

Net cash used in investing activities - continuing operations
(28,250
)
 
(20,764
)
Net cash used in investing activities - discontinued operations
(680
)
 
(199
)
Net cash used in investing activities
(28,930
)
 
(20,963
)
Cash flows from financing activities:
 
 
 
 Proceeds from exercise of employee stock options
346

 

   Repayment of long-term debt
(6,662
)
 
(19,375
)
   Debt financing costs
(526
)
 

   Proceeds from sale of noncontrolling interest in subsidiary

 
50

Cash distributions to noncontrolling interests
(496
)
 
(219
)
   Repayments of capitalized obligations
(616
)
 
(171
)
Net cash used in financing activities   
(7,954
)
 
(19,715
)
Net effect of foreign currency exchange rate changes
(45
)
 
(877
)
Net increase in cash and restricted cash
13,755

 
18,242

Cash and restricted cash:
 
 
 
Beginning of period
51,540

 
33,298

End of period
$
65,295

 
$
51,540


7




TOWNSQUARE MEDIA, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
(in Thousands)
 
Year Ended December 31,
 
2017
 
2016
Supplemental Disclosure of Cash Flow Information:
 
 
 
Cash payments:
 
 
 
Interest
$
29,917

 
$
32,371

Income taxes
3,170

 
1,878

Purchase obligations:
 
 
 
Capital lease
$

 
$
525

Equity issued in respect of acquisitions:
 
 
 
Common stock, joint venture acquisition
$
513

 
$

Non-cash investment:
 
 
 
Investments
$
2,972

 
$
3,500



8




TOWNSQUARE MEDIA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS BY SEGMENT
(in Thousands)
 
Three Months Ended December 31,
 
Years Ended December 31,
 
2017
 
2016
 
2017
 
2016
Statement of Operations Data:
 
 
 
 
 
 
 
  Local Marketing Solutions net revenue
$
91,648

 
$
91,277

 
$
348,660

 
$
342,191

  Entertainment net revenue
22,607

 
27,373

 
158,774

 
173,804

Net revenue
114,255

 
118,650

 
507,434

 
515,995

Operating Costs and Expenses:
 
 
 
 
 
 
 
  Local Marketing Solutions direct operating expenses
61,783

 
58,460

 
234,524

 
223,286

  Entertainment direct operating expenses
23,400

 
28,390

 
149,888

 
160,708

Direct operating expenses, excluding depreciation, amortization and stock-based compensation
85,183

 
86,850

 
384,412

 
383,994

Depreciation and amortization
5,935

 
6,159

 
25,683

 
23,971

Corporate expenses
7,453

 
7,050

 
25,828

 
25,370

Stock-based compensation
177

 
3,590

 
748

 
4,253

Transaction costs
569

 
238

 
1,175

 
844

Business realignment costs
6,204

 

 
6,204

 

Goodwill and other intangible impairment charges
51,848

 

 
51,848

 

Net (gain) loss on sale and retirement of assets
(265
)
 
(5
)
 
397

 
282

Total operating costs and expenses
157,104

 
103,882

 
496,295

 
438,714

Operating (loss) income
(42,849
)
 
14,768

 
11,139

 
77,281

Other expense (income):
 
 
 
 
 
 
 
Interest expense, net
8,279

 
8,332

 
32,753

 
34,072

Impairment on investment

 

 

 
4,236

Repurchase of debt

 
(85
)
 

 
(546
)
Other expense (income), net
99

 
(312
)
 
288

 
(665
)
(Loss) income from continuing operations before income taxes
(51,227
)
 
6,833

 
(21,902
)
 
40,184

(Benefit) provision for income taxes
(24,956
)
 
3,713

 
(13,027
)
 
16,982

Net (loss) income from continuing operations
(26,271
)
 
3,120

 
(8,875
)
 
23,202

Net (loss) income from discontinued operations, net of income taxes
(850
)
 
91

 
(1,398
)
 
91

     Net (loss) income
$
(27,121
)
 
$
3,211

 
$
(10,273
)
 
$
23,293



9




The following table reconciles on a GAAP basis net (loss) income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted Net Income for the three months and years ended December 31, 2017 and 2016, respectively (in thousands, except per share data):
 
Three Months Ended
December 31,
 
Years Ended
December 31,
 
2017
 
2016
 
2017
 
2016
Net (loss) income
$
(27,121
)
 
$
3,211

 
$
(10,273
)
 
$
23,293

  (Benefit) provision for income taxes
(24,956
)
 
3,713

 
(13,027
)
 
16,982

(Loss) income before income taxes
(52,077
)
 
6,924

 
(23,300
)
 
40,275

Transaction costs
569

 
238

 
1,175

 
844

   Business realignment costs
6,204

 

 
6,204

 

Goodwill and other intangible impairment charges
51,848

 

 
51,848

 

Impairment on investment

 

 

 
4,236

Stock option repricing

 
3,435

 

 
3,435

Net (gain) loss on sale and retirement of assets
(265
)
 
(5
)
 
397

 
282

Repurchase of debt

 
(85
)
 

 
(546
)
Net loss (income) from discontinued operations, net of income taxes
850

 
(91
)
 
1,398

 
(91
)
Adjusted income before income taxes
7,129

 
10,416

 
37,722

 
48,435

  Adjusted provision for income taxes
3,243

 
5,586

 
17,160

 
20,423

Adjusted Net Income
$
3,886

 
$
4,830

 
$
20,562

 
$
28,012

 
 
 
 
 
 
 
 
Adjusted Net Income Per Share:
 
 
 
 
 
 
 
     Basic
$
0.21

 
$
0.26

 
$
1.11

 
$
1.53

     Diluted
$
0.14

 
$
0.18

 
$
0.74

 
$
1.03

 
 
 
 
 
 
 
 
Weighted average shares outstanding:
 
 
 
 
 
 
 
     Basic
18,478

 
18,395

 
18,459

 
18,255

     Diluted
27,457

 
27,419

 
27,855

 
27,313



10




The following table reconciles on a GAAP basis net (loss) income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA and Adjusted EBITDA Less Interest, Capex and Taxes for the three months and years ended December 31, 2017 and 2016, respectively (dollars in thousands):
 
Three Months Ended December 31,
 
Years Ended December 31,
 
2017
 
2016
 
2017
 
2016
Net (loss) income
$
(27,121
)
 
$
3,211

 
$
(10,273
)
 
$
23,293

  (Benefit) provision for income taxes
(24,956
)
 
3,713

 
(13,027
)
 
16,982

  Interest expense, net
8,279

 
8,332

 
32,753

 
34,072

  Transaction costs
569

 
238

 
1,175

 
844

  Depreciation and amortization
5,935

 
6,159

 
25,683

 
23,971

  Stock-based compensation
177

 
3,590

 
748

 
4,253

  Business realignment costs
6,204

 

 
6,204

 

Goodwill and other intangible impairment charges
51,848

 

 
51,848

 

Impairment on investment

 

 

 
4,236

  Repurchase of debt

 
(85
)
 

 
(546
)
Net loss (income) from discontinued operations, net of income taxes
850

 
(91
)
 
1,398

 
(91
)
  Other(a)
(166
)
 
(317
)
 
684

 
(383
)
Adjusted EBITDA
21,619

 
24,750

 
97,193

 
106,631

  Net Cash paid for interest
(11,342
)
 
(12,490
)
 
(29,917
)
 
(32,371
)
  Capital expenditures
(4,655
)
 
(3,896
)
 
(22,824
)
 
(20,722
)
  Cash paid for taxes
(1,246
)
 
32

 
(3,170
)
 
(1,878
)
Adjusted EBITDA Less Interest, Capex and Taxes
$
4,376

 
$
8,396

 
$
41,282

 
$
51,660

(a) Other includes net (gain) loss on sale and retirement of assets, (gain) loss on foreign exchange and other (income) expense, net.

The following table reconciles net (loss) income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA on a quarterly basis for the twelve months ended December 31, 2017 (dollars in thousands):
 
Three Months Ended
 
Twelve Months Ended
 
March 31, 2017
 
June 30, 2017
 
September 30, 2017
 
December 31, 2017
 
December 31, 2017
Net (loss) income
$
(3,008
)
 
$
5,563

 
$
14,293

 
$
(27,121
)
 
$
(10,273
)
  (Benefit) provision for income taxes
(1,997
)
 
3,810

 
10,116

 
(24,956
)
 
(13,027
)
  Interest expense, net
8,254

 
7,990

 
8,230

 
8,279

 
32,753

  Transaction costs
199

 
189

 
218

 
569

 
1,175

  Depreciation and amortization
6,383

 
6,828

 
6,537

 
5,935

 
25,683

  Stock-based compensation
188

 
183

 
200

 
177

 
748

  Business realignment costs

 

 

 
6,204

 
6,204

Goodwill and other intangible impairment charges

 

 

 
51,848

 
51,848

Net loss from discontinued operations, net of income taxes
165

 
181

 
202

 
850

 
1,398

  Other(a)
31

 
732

 
87

 
(166
)
 
684

Adjusted EBITDA
$
10,215

 
$
25,476

 
$
39,883

 
$
21,619

 
$
97,193

(a) Other includes net (gain) loss on sale and retirement of assets, (gain) loss on foreign exchange and other (income) expense, net.

11






The following tables reconcile segment operating income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted Segment Operating Income (Loss) for the three months and years ended December 31, 2017 and 2016, respectively (dollars in thousands):

 
Three Months Ended December 31,
 
2017
 
2016
 
2017
 
2016
 
Local Marketing Solutions
 
Entertainment
 
 
 
 
 
 
 
 
Segment operating income (loss)
$
23,788

 
$
28,961

 
$
(58,211
)
 
$
(3,473
)
 
 
 
 
 
 
 
 
Depreciation and amortization
3,127

 
3,088

 
2,269

 
2,086

Stock-based compensation
35

 
768

 
11

 
369

Business realignment costs

 

 
6,204

 

Goodwill and other intangible impairment charges
2,915

 

 
48,933

 

 
 
 
 
 
 
 
 
Adjusted Segment Operating Income (Loss)
$
29,865

 
$
32,817

 
$
(794
)
 
$
(1,018
)

 
Years Ended December 31,
 
2017
 
2016
 
2017
 
2016
 
Local Marketing Solutions
 
Entertainment
 
 
 
 
 
 
 
 
Segment operating income (loss)
$
96,631

 
$
105,430

 
$
(55,395
)
 
$
4,106

 
 
 
 
 
 
 
 
Depreciation and amortization
14,458

 
12,612

 
9,043

 
8,545

Stock-based compensation
132

 
863

 
101

 
445

Business realignment costs

 

 
6,204

 

Goodwill and other intangible impairment charges
2,915

 

 
48,933

 

 
 
 
 
 
 
 
 
Adjusted Segment Operating Income
$
114,136

 
$
118,905

 
$
8,886

 
$
13,096



12





Reconciliation of Net revenue to Net revenue, excluding political revenue for the three months and years ended December 31, 2017 and 2016, respectively (dollars in thousands):
 
Three Months Ended December 31,
 
%
 
Years Ended
December 31,
 
%
 
2017
 
2016
 
Change
 
2017
 
2016
 
Change
Consolidated:
 
 
 
 
 
 
 
 
 
 
 
Net revenue
$
114,255

 
$
118,650

 
(3.7
)%
 
$
507,434

 
$
515,995

 
(1.7
)%
  Less: Political revenue
1,187

 
5,320

 
(77.7
)%
 
2,428

 
9,017

 
(73.1
)%
Net revenue, excluding political revenue
$
113,068

 
$
113,330

 
(0.2
)%
 
$
505,006

 
$
506,978

 
(0.4
)%
 
 
 
 
 
 
 
 
 
 
 
 
Local Marketing Solutions Segment:
 
 
 
 
 
 
 
 
 
 
 
Net revenue
$
91,648

 
$
91,277

 
0.4
 %
 
$
348,660

 
$
342,191

 
1.9
 %
  Less: Political revenue
1,187

 
5,320

 
(77.7
)%
 
2,428

 
9,017

 
(73.1
)%
Net revenue, excluding political revenue
$
90,461

 
$
85,957

 
5.2
 %
 
$
346,232

 
$
333,174

 
3.9
 %


13

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