Citing 'Transition Year,' Citadel Reports Financials
May 8, 2008 at 6:24 AM (PT)
CITADEL BROADCASTING has reported its results for the first quarter of 2008. Net revenues for the first quarter of 2008 were $205.8 million as compared to $92.9 million for the first quarter of 2007. The increase in revenues was a result of the acquisition of ABC RADIO on JUNE 12, 2007. On a pro forma basis, net revenues in the first quarter of 2008 were $202.8 million as compared to $213.1 million for the quarter ended MARCH 31st, 2007. This decrease in pro forma revenues of $10.3 million, or 4.8%, is primarily the result of a $11.7 million decline in revenue from their radio markets, partially offset by an increase in revenue at the Radio Network.
Operating income for the first quarter of 2008 was $17.6 million, which reflects a non-cash charge of approximately $22.2 million related to the termination of a pre-existing national representation contract, as compared to $25.6 million in the corresponding 2007 period, a decrease of $8.0 million.
Net interest expense increased to $35.4 million from $7.8 million, an increase of $27.6 million. The increase in net interest expense was primarily the result of the interest incurred on the increased borrowings to finance the merger with ABC RADIO as well as the payment of approximately $276.5 million for the Special Distribution to pre-merger shareholders.
Chairman/CEO FARID SULEMAN commented: "2008 is a transition year for ABC RADIO. The Company is making significant changes at its major-market radio stations in order to position the group for growth in the second half of 2008 and 2009. The Company completed a major restructuring of these stations late in the first quarter, including format changes in three markets, and expects a reduction in expenses in the second quarter and throughout the remainder of 2008 and 2009. The ABC NETWORK had a positive quarter with both an increase in revenue and reduction in expenses when compared to the prior year quarter. The Company will continue to utilize its considerable free cash flow to pay down debt during 2008."