Cumulus Q3 Revenue Plateaus; Lew Dickey Sees Q4 Improvements
November 10, 2014 at 2:38 PM (PT)
CUMULUS MEDIA reports pro forma Q3 2014 revenue of almost $314 million, essentially flat from the same quarter last year. Pro forma adjusted EBITDA was $97.5 million, down a bit over 18%.
Broadcast advertising rose 15% to almost $288 million , digital advertising rose almost 135% to $12.6 million, and Political advertising rose 245% to $4.3 million. Countering those increases was a 62% increase in Content Costs at $106.5 million, which took a larger percentage of total net revenues, from 25% in 2013 to 34% in Q4 2014.
In the quarterly conference call, CUMULUS MEDIA Chairman/CEO LEW DICKEY cited the transition of major-market morning shows as one culprit to their revenue issues. "We have been working our way through a generational shift among morning talent," citing KLOS, where MARK & BRIAN were replaced by HEIDI & FRANK; NEW YORK, where SCOTT SHANNON left WPLJ; WASHINGTON, D.C., where JACK DIAMOND left; and CHICAGO, where WADE & ROMA are no longer heard on WLS-A. He cited the transitions in NEW YORK and WASHINGTON, D.C. as being largely responsible for the EBITDA decline.
"The worst is behind us," DICKEY said. "It has been a tough year, but we're starting to see a light at the end of the tunnel. We're beginning to see positive ratings traction in the new shows that have been in place the longest."
Other interesting tidbits:
* WESTWOOD ONE's synergy target will be achieved, which should provide incremental $25 million in savings in 2015
* Future NASH affiliations will go through WESTWOOD ONE. NASH ICON is now in 16 markets.
* NASH revenue is expected to reach $25 million in 2015 and 2016
* Core growth was cited as 1.5%. Local was down 3.2%, while national was up 2.8% and network was generally flat. DICKEY said national is pacing much better in Q4, up "double-digits" with local up in "low single-digits."