CC Media Holdings Posts $5 Billion Loss
March 2, 2009 at 6:29 AM (PT)
CC MEDIA HOLDINGS, formed to be the parent company of CLEAR CHANNEL COMMUNICATIONS INC., posted a net loss of $5 billion, reports THE WALL STREET JOURNAL. A year earlier, when the company operated as CLEAR CHANNEL COMMUNICATIONS INC., it posted net income of $320.6 million. The latest results included $5.27 billion in write-downs, nearly $1.7 billion of which was on federal licenses and permits.
Revenue decreased 14% to $1.61 billion.
CLEAR CHANNEL OUTDOOR HOLDINGS INC. swung to a Q4 net loss on a $3.2 billion write-down as parent company CC MEDIA HOLDINGS INC. posted a $5 billion loss amid those billboard woes. Billboard advertising had been holding up well amid the economic downturn, though there have been signs of recent weakening. CBS CORP. reported earlier this month that its billboard business, which had been its most reliable growth area, saw revenue drop 15%.
Earlier this month, STANDARD & POOR'S lowered its credit ratings on CC MEDIA HOLDINGS one notch further into junk territory, citing continuing concerns over the company's ability to comply with its debt covenants.
The company recently borrowed the remaining $1.6 billion under a $2 billion revolving credit line, citing concerns about the state of the credit markets. The move raised fears on WALL STREET that CLEAR CHANNEL was choosing to access the funds for fear it wouldn't be able to if it breached covenants.