Citadel Reports Revs Down 4.8%
August 15, 2011 at 6:44 AM (PT)
CITADEL BROADCASTING TODAY (8/15) reported certain results for the quarter ended JUNE 30, 2011.
Consolidated net revenue for the second quarter of 2011 was $185.0 million as compared to $194.4 million for the second quarter of 2010, a decrease of $9.4 million, or 4.8%. "This decrease was due to a $6.8 million revenue decrease at our Radio Markets segment and a $2.7 million revenue decrease at our Radio Network segment," noted CITADEL. "Our revenue at the Radio Markets was negatively impacted by lower local and national revenues as well as a decrease in political revenues and the termination of a local marketing agreement to operate a station in KNOXVILLE, TN. Generally, our stations in medium to small metropolitan markets performed better than those stations in larger metropolitan markets. The decrease in Radio Network revenue was due in part to lower sales representation revenues and lower revenue from our Hispanic and news-related networks."
Operating income for the second quarter of 2011 was $28.3 million as compared to $56.0 million in the corresponding 2010 period, a decrease of $27.7 million, or 49.4%. "Operating income for the second quarter of 2011 reflects higher depreciation and amortization of $10.0 million resulting from the application of fresh-start accounting, which required the Company to fair value its assets and liabilities as of the Fresh-Start Date, and an increase of $11.2 million in non-cash compensation expense and related taxes due to the issuance of non-vested shares of class A common stock and options to purchase shares of class A common stock in the second half of 2010," noted the company.
On MARCH 10, 2011, CITADEL BROADCASTING CORPORATION entered into a definitive merger agreement with CUMULUS MEDIA INC. under which CUMULUS will acquire the Company in a merger pursuant to which the Company's stockholders will have the right to elect to receive $37.00 in cash or 8.525 shares of Cumulus class A common stock for each share of the Company's common stock, subject to proration.
CEO FARID SULEMAN commented, "During the second quarter of 2011, the Company's revenues were negatively impacted by a slow down in the overall advertising environment, as well as a reduction in political advertising revenue. In spite of the decrease in revenues, the Company was able to increase its free cash flow for the first six months of 2011 as compared to the same period in 2010 by $0.6 million, or 0.7%, due primarily to lower cash payments for interest and lower radio station and network operating expenses. In addition, the Company has repaid $53.5 million in term loans during the first six months of 2011 and has over $100 million in cash on hand as of JUNE 30th. The Company remains focused on working toward the consummation of the merger."