Beasley Q4 Revenues Drop; One-Time Charge Leads To Loss

Q4 Down

BEASLEY BROADCAST GROUP fourth-quarter net revenue fell from $35 to $20.5 million, with the company going from a net income of $500,000 to a net loss of $36.5 million (+2 cents/share to -$1.58/share). The 2008 figures include a $62.5 million pre-tax, non cash impairment charge (-$1.66/share). The drop in revenue was attributed to weakness at the company's FORT MYERS-NAPLES, LAS VEGAS, and MIAMI clusters, as well as declines in PHILADELPHIA and COASTAL CAROLINA, partly offset by a $200,000 increase in FAYETTEVILLE, NC and a $400,000 gain (31%) in interactive and off-air revenue.

Chairman/CEO GEORGE G. BEASLEY said, "BEASLEY BROADCAST GROUP, the radio industry and businesses at-large faced extremely challenging conditions in the fourth quarter of 2008. Our fourth-quarter revenue decline reflects deteriorating local and national advertising -- including steep declines for traditionally significant advertising segments such as auto and retail -- as well as the impact of severe real estate downturns in several of the markets where we operate including FT. MYERS-NAPLES, MIAMI and LAS VEGAS. The 12.9% quarterly net revenue decline overshadows the ongoing success of our interactive and off-air initiatives where revenue grew by 31% year-over-year.

"In light of the extremely challenging economic environment and industry conditions BEASLEY has taken steps to reduce spending at both the station and corporate levels including a reduction of approximately 7% of the Company's workforce and a recently instituted company-wide salary reduction of 5%. While difficult, we believe the salary reduction preserves jobs and allows our station and corporate personnel to focus on programming, local sales and other initiatives to ride out the impact of the economy. Throughout 2008 we applied cash on hand and cash from operations to debt reduction. Reflecting this focus, interest expense declined by approximately 35% for the full year and total debt fell to approximately $174.5 million at DECEMBER 31, 2008 from approximately $191.1 million at DECEMBER 31, 2007.

"Excluding the impact of the impairment charge, and reflecting the efficiencies achieved through cost reductions, BEASLEY BROADCAST GROUP's fourth quarter and full year net income and net income per share equaled or exceeded the results from the comparable period of 2007.

"With a half century of radio broadcasting experience, BEASLEY BROADCAST GROUP has endured and managed through other economic downturns. We remain committed to return-focused investments in programming, sales, HD conversions and our interactive initiatives while also strictly managing expenses. Reflecting our ongoing commitment to the radio broadcasting industry and Beasley Broadcast Group, in the fourth quarter of 2008, the Company repurchased 1.1 million BEASLEY BROADCAST shares. Reflecting my personal optimism about the resiliency of the radio broadcasting industry and the future of BEASLEY BROADCAST GROUP, I also personally purchased 1.1 million shares of BEASLEY BROADCAST GROUP for a total of $1.1 million in the fourth quarter."

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