Beasley Broadcast Group, Inc. (Nasdaq: BBGI) (“Beasley” or the
“Company”), a multi-platform media company, today announced
operating results for the three- and twelve-month periods ended
December 31, 2022.
Summary of Fourth Quarter and Full Year
Results
In millions, except per share data |
Three Months EndedDecember
31, |
Twelve Months EndedDecember
31, |
|
2022 |
2021 |
2022 |
2021 |
Net revenue |
$72.0 |
|
$70.7 |
$256.4 |
|
$241.4 |
|
Operating income (loss) 1 |
(33.5 |
) |
6.5 |
(36.1 |
) |
14.7 |
|
Net income (loss) 1 |
(25.8 |
) |
10.6 |
(43.4 |
) |
(1.5 |
) |
Net income (loss) per diluted share 1 |
($0.87 |
) |
$0.36 |
($1.47 |
) |
($0.05 |
) |
Station operating income (SOI - non-GAAP) |
13.9 |
|
13.9 |
43.1 |
|
42.0 |
|
1Operating loss, net loss and net loss per
diluted share for the three months ended December 31, 2022 include
$44.2 million of non-cash impairment losses related to FCC
licenses, goodwill and franchise rights. Operating loss, net loss
and net loss per diluted share for the twelve months ended December
31, 2022 include $54.7 million of non-cash impairment losses
related to FCC licenses, goodwill and franchise rights. Net loss
and net loss per diluted share in the three and twelve months ended
December 31, 2021 reflect a $10.0 million gain on forgiveness of
long-term debt. Net loss and net loss per diluted share in the
twelve months ended December 31, 2021 reflect a $5.0 million loss
on extinguishment of long-term debt.
Net revenue during the three months ended
December 31, 2022 increased 1.8% to $72.0 million, primarily
reflecting a year-over-year increase in digital revenue, political
revenue and other revenue, partially offset by a slight decrease in
audio revenue related to softness in the national agency
business.
Beasley reported an operating loss of $33.5
million in the fourth quarter of 2022, compared to operating income
of $6.5 million in the fourth quarter of 2021, primarily due to
$44.2 million of non-cash impairment losses and higher operating
expenses related to digital, partially offset by lower corporate
and depreciation and amortization expense.
The financial information included in this
release reflects the recognition of preliminary pre-tax noncash
impairment charges of $54.7 million relating to FCC licenses,
goodwill and franchise rights. The Company is in the process of
finalizing the impairment assessment. As a result, the financial
information included in this report is subject to change and
constitutes forward-looking information. Actual results may differ
materially from the preliminary unaudited results provided herein.
The Company expects to complete the impairment analysis and
finalize the impairment charges in connection with the filing of
the Company’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2022.
Beasley reported a net loss of $25.8 million, or
$0.87 per diluted share, in the three months ended December 31,
2022, compared to net income of $10.6 million, or $0.36 per diluted
share, in the three months ended December 31, 2021. The fourth
quarter net loss was primarily due to the aforementioned non-cash
impairment losses. The comparable 2021 period also benefitted from
a $10.0 million gain on forgiveness of long-term debt for the
Company’s loan granted under Paycheck Protection Program.
SOI increased 0.2% to $13.9 million in the
fourth quarter of 2022 primarily due to higher revenue.
Please refer to the “Calculation of SOI” and
“Reconciliation of Net Loss Attributable to BBGI Stockholders to
SOI” tables at the end of this announcement for a discussion
regarding SOI calculations.
Commenting on the financial results, Caroline
Beasley, Chief Executive Officer, said, “Beasley’s 2022 fourth
quarter and full year financial results reflect the ongoing success
of our digital transformation and revenue diversification
strategies, which drove year-over-year increases in revenue and SOI
for both the three- and twelve-month periods. Throughout the year,
Beasley largely offset ongoing challenges related to the economy
and softness in the national spot market, as we generated healthy
growth across all of our digital, local audio, political and other
revenue sources, as reflected by the 6.2% increase in full year net
revenues to $256 million. This top-line growth was the primary
factor contributing to a 2.8% year-over-year increase in full year
SOI to $43.1 million.
“While economic uncertainty remains, Beasley
initiated several actions throughout the year that we believe will
strengthen the long-term position of our business. First, our
digital strategy continues to deliver strong results with fourth
quarter digital revenue growth of 13.2% year-over-year,
representing nearly 17% of total fourth quarter revenue. Digital
revenue has consistently outpaced national spot advertising revenue
over the past several quarters due to a combination of organic
growth and contributions from the second quarter acquisition of our
white label digital agency business, Guarantee Digital. With
accelerating demand from consumers and advertisers for our local
content and multi-platform marketing solutions, we are solidly on
the path for this revenue source to reach 20% of total revenue.
“Second, we remain focused on monetizing our
premium audio and digital content through new local business
development, revenue diversification and maximizing political
revenue opportunities. As a result, in the fourth quarter, we
delivered $5.1 million in net political revenue, with stronger than
expected gains in Las Vegas, Philadelphia, and Detroit, as well as
year-over-year total revenue increases across nearly all of our
markets and in our esports business. Our radio brands remain
dominant in Nielsen Audio ratings, where Beasley currently has the
highest average cluster share when compared to the major radio
broadcasters in PPM. Finally, we implemented a cost reduction
program in the second half of 2022, with the majority of cost cuts
occurring in October.
“Total outstanding debt as of December 31, 2022
was $290.0 million, reflecting our bond repurchase activity
throughout 2022. As such, fourth quarter interest expense declined
to $6.6 million. Beasley had $39.5 million of cash and cash
equivalents on hand at quarter end. We intend to keep our cash on
the balance sheet in order to maintain our strong liquidity
position, given the uncertain economic environment.
“Looking ahead to 2023, our strategic priorities
remain focused on growing our overall audience and delivering
exceptional content and services to our listeners, advertisers,
online users and esports fans, while diversifying our revenue,
growing our cash flow and maintaining a solid and flexible balance
sheet with liquidity at current or higher levels, which we believe
will best position Beasley for near- and long-term success and the
enhancement of stockholder value.”
Conference Call and Webcast
InformationThe Company will host a conference call and
webcast today, February 16, 2023, at 11:00 a.m. ET to discuss its
financial results and operations. To access the conference call,
interested parties may dial 1-877-407-4018 or 1-201-689-8471,
conference ID 13735868 (domestic and international callers).
Participants can also listen to a live webcast of the call at the
Company’s website at www.bbgi.com. Please allow 15 minutes to
register and download and install any necessary software. Following
its completion, a replay of the webcast can be accessed for five
days on the Company’s website, www.bbgi.com.
Questions from analysts, institutional investors
and debt holders may be e-mailed to ir@bbgi.com at any time up
until 10:00 a.m. ET on Thursday, February 16, 2023. Management will
answer as many questions as possible during the conference call and
webcast (provided the questions are not addressed in their prepared
remarks).
About Beasley Broadcast
GroupCelebrating its 62nd anniversary this year, Beasley
Broadcast Group, Inc., (www.bbgi.com) was founded in 1961 by George
G. Beasley. Beasley Broadcast Group owns and operates 61 AM and FM
stations in 14 large- and mid-size markets in the United States.
Beasley radio stations reach approximately 20 million unique
consumers weekly over-the-air, online and on smartphones and
tablets, and millions regularly engage with the Company’s brands
and personalities through digital platforms such as Facebook,
Twitter, text, apps and email. For more information, please visit
www.bbgi.com.
For further information, or to receive future
Beasley Broadcast Group news announcements via e-mail, please
contact Beasley Broadcast Group, at 239-263-5000 or email@bbgi.com,
or Joseph Jaffoni, JCIR, at 212-835-8500 or bbgi@jcir.com.
DefinitionsStation Operating
Income (SOI) consists of net revenue less station operating
expenses. We define station operating expenses as cost of services
and selling, general and administrative expenses.
SOI is a measure widely used in the radio
broadcast industry. The Company recognizes that because SOI is not
calculated in accordance with GAAP, it is not necessarily
comparable to similarly titled measures employed by other
companies. However, management believes that SOI provides
meaningful information to investors because it is an important
measure of how effectively we operate our business (i.e., operate
radio stations) and assists investors in comparing our operating
performance with that of other radio companies.
Note Regarding Forward-Looking
StatementsStatements in this release that are
“forward-looking statements” are based upon current expectations
and assumptions, and involve certain risks and uncertainties within
the meaning of the U.S. Private Securities Litigation Reform Act of
1995. Words or expressions such as “looking ahead,” “intends,”
“believes,” “expects,” “seek,” “will,” “should,” or variations of
such words and similar expressions are intended to identify such
forward-looking statements. Forward-looking statements by their
nature address matters that are, to different degrees, uncertain.
Key risks are described in the Company’s reports filed with the
Securities and Exchange Commission (“SEC”) including its annual
report on Form 10-K and quarterly reports on Form 10-Q. Readers
should note that forward-looking statements are subject to change
and to inherent risks and uncertainties and may be impacted by
several factors, including:
- the effects of the COVID-19
pandemic, including its potential effects on the economic
environment and our results of operations, liquidity and financial
condition, and the increased risk of impairments of our FCC
licenses and/or goodwill;
- external economic forces that could
have a material adverse impact on our advertising revenues and
results of operations;
- the ability of our radio stations
to compete effectively in their respective markets for advertising
revenues;
- our ability to develop compelling
and differentiated digital content, products and services;
- audience acceptance of our content,
particularly our audio programs;
- our ability to respond to changes
in technology, standards and services that affect the audio
industry;
- our dependence on federally issued
licenses subject to extensive federal regulation;
- actions by the FCC or new
legislation affecting the audio industry;
- increases to royalties we pay to
copyright owners or the adoption of legislation requiring royalties
to be paid to record labels and recording artists;
- our dependence on selected market
clusters of radio stations for a material portion of our net
revenue;
- credit risk on our accounts
receivable;
- the risk that our FCC licenses
and/or goodwill could become impaired;
- our substantial debt levels and the
potential effect of restrictive debt covenants on our operational
flexibility and ability to pay dividends;
- the potential effects of hurricanes
on our corporate offices and radio stations;
- the failure or destruction of the
internet, satellite systems and transmitter facilities that we
depend upon to distribute our programming;
- disruptions or security breaches of
our information technology infrastructure;
- the loss of key personnel;
- our ability to integrate acquired
businesses and achieve fully the strategic and financial objectives
related thereto and their impact on our financial condition and
results of operations;
- the fact that our Company is
controlled by the Beasley family, which creates difficulties for
any attempt to gain control of our Company; and
- other economic, business,
competitive, and regulatory factors affecting our business,
including those set forth in our filings with the SEC.
Our actual performance and results could differ
materially because of these factors and other factors discussed in
our SEC filings, including but not limited to our annual reports on
Form 10-K or quarterly reports on Form 10-Q, copies of which can be
obtained from the SEC, www.sec.gov, or our website, www.bbgi.com.
All information in this release is as of February 16, 2023 and we
undertake no obligation to update the information contained herein
to actual results or changes to our expectations.
BEASLEY BROADCAST GROUP,
INC.Consolidated Statements of Operations (Unaudited)
|
Three months ended |
|
Twelve months ended |
|
December 31, |
|
December 31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net revenue |
$ |
72,027,012 |
|
|
$ |
70,736,628 |
|
|
$ |
256,381,018 |
|
|
$ |
241,426,308 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
Operating expenses (including stock-based compensation and
excluding depreciation and amortization shown separately
below) |
|
58,088,223 |
|
|
|
56,821,830 |
|
|
|
213,236,063 |
|
|
|
199,470,185 |
|
Corporate expenses (including stock-based compensation) |
|
4,068,067 |
|
|
|
4,734,088 |
|
|
|
18,001,359 |
|
|
|
16,578,046 |
|
Depreciation and amortization |
|
2,496,898 |
|
|
|
2,663,821 |
|
|
|
9,920,546 |
|
|
|
11,309,995 |
|
Impairment losses |
|
44,191,147 |
|
|
|
- |
|
|
|
54,667,470 |
|
|
|
- |
|
Gain on exchange |
|
(3,350,539 |
) |
|
|
- |
|
|
|
(3,350,539 |
) |
|
|
- |
|
Gain on disposition |
|
|
|
|
|
|
|
- |
|
|
|
(191,988 |
) |
Other operating income, net |
|
|
|
|
|
|
|
- |
|
|
|
(400,000 |
) |
Total operating expenses |
|
105,493,796 |
|
|
|
64,219,739 |
|
|
|
292,474,899 |
|
|
|
226,766,238 |
|
Operating income (loss) |
|
(33,466,784 |
) |
|
|
6,516,889 |
|
|
|
(36,093,881 |
) |
|
|
14,660,070 |
|
Non-operating income
(expense): |
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
(6,620,251 |
) |
|
|
(6,791,219 |
) |
|
|
(26,914,045 |
) |
|
|
(26,456,236 |
) |
Loss on extinguishment of long-term debt |
|
|
|
|
|
|
|
- |
|
|
|
(4,996,731 |
) |
Gain on forgiveness of long-term debt |
|
- |
|
|
|
10,000,000 |
|
|
|
- |
|
|
|
10,000,000 |
|
Other income, net |
|
24,810 |
|
|
|
9,758 |
|
|
|
1,382,322 |
|
|
|
68,437 |
|
Gain (loss) before income taxes |
|
(40,062,225 |
) |
|
|
9,735,428 |
|
|
|
(61,625,604 |
) |
|
|
(6,724,460 |
) |
Income tax benefit |
|
(14,368,073 |
) |
|
|
(903,970 |
) |
|
|
(18,242,719 |
) |
|
|
(5,321,630 |
) |
Gain (loss) before equity in earnings of unconsolidated
affiliates |
|
(25,694,152 |
) |
|
|
10,639,398 |
|
|
|
(43,382,885 |
) |
|
|
(1,402,830 |
) |
Equity in earnings of
unconsolidated affiliates, net of tax |
|
(153,414 |
) |
|
|
(57,222 |
) |
|
|
(12,260 |
) |
|
|
(132,264 |
) |
Net income (loss) |
|
(25,847,566 |
) |
|
|
10,582,176 |
|
|
|
(43,395,145 |
) |
|
|
(1,535,094 |
) |
Earnings attributable to
noncontrolling interest |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
129,249 |
|
Net income (loss) attributable to BBGI stockholders |
$ |
(25,847,566 |
) |
|
$ |
10,582,176 |
|
|
$ |
(43,395,145 |
) |
|
$ |
(1,405,845 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net loss per
share |
$ |
(0.87 |
) |
|
$ |
0.36 |
|
|
$ |
(1.47 |
) |
|
$ |
(0.05 |
) |
Basic common shares
outstanding |
|
29,557,050 |
|
|
|
29,264,059 |
|
|
|
29,473,989 |
|
|
|
29,263,987 |
|
Diluted common shares
outstanding |
|
29,557,050 |
|
|
|
29,412,239 |
|
|
|
29,473,989 |
|
|
|
29,263,987 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Balance Sheet Data -
Unaudited(in thousands)
|
December 31, |
|
December 31, |
|
2022 |
|
2021 |
Cash and cash equivalents |
$ |
39,535 |
|
$ |
51,379 |
Working capital |
|
48,966 |
|
|
67,696 |
Total assets |
|
707,437 |
|
|
762,088 |
Long-term debt, net of
unamortized debt issuance costs |
|
285,472 |
|
|
293,790 |
Stockholders' equity |
$ |
222,151 |
|
$ |
263,082 |
Selected Statement of Cash Flows Data –
Unaudited
|
Year ended |
|
December 31, |
|
2022 |
|
|
2021 |
|
Net cash provided by (used in) operating activities |
$ |
11,147,084 |
|
|
$ |
(1,907,227 |
) |
Net cash used in investing
activities |
|
(14,177,688 |
) |
|
|
(1,136,268 |
) |
Net cash provided by (used in)
financing activities |
|
(8,813,385 |
) |
|
|
33,662,705 |
|
Net increase (decrease) in
cash and cash equivalents |
$ |
(11,843,989 |
) |
|
$ |
30,619,210 |
|
Calculation of SOI –
Unaudited
|
Three months ended |
|
Year ended |
|
December 31, |
|
December 31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net revenue |
$ |
72,027,012 |
|
|
$ |
70,736,628 |
|
|
$ |
256,381,018 |
|
|
$ |
241,426,308 |
|
Operating expenses |
|
(58,088,223 |
) |
|
|
(56,821,830 |
) |
|
|
(213,236,063 |
) |
|
|
(199,470,185 |
) |
SOI |
$ |
13,938,789 |
|
|
$ |
13,914,798 |
|
|
$ |
43,144,955 |
|
|
$ |
41,956,123 |
|
Reconciliation of Net
Loss Attributable to BBGI Stockholders to SOI –
Unaudited
|
Three months ended |
|
Year ended |
|
December 31, |
|
December 31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net income (loss) attributable
to BBGI stockholders |
$ |
(25,847,566 |
) |
|
$ |
10,582,176 |
|
|
$ |
(43,395,145 |
) |
|
$ |
(1,405,845 |
) |
Corporate expenses |
|
4,068,067 |
|
|
|
4,734,088 |
|
|
|
18,001,359 |
|
|
|
16,578,046 |
|
Depreciation and
amortization |
|
2,496,898 |
|
|
|
2,663,821 |
|
|
|
9,920,546 |
|
|
|
11,309,995 |
|
Impairment losses |
|
44,191,147 |
|
|
|
- |
|
|
|
54,667,470 |
|
|
|
- |
|
Gain on exchange |
|
(3,350,539 |
) |
|
|
- |
|
|
|
(3,350,539 |
) |
|
|
- |
|
Gain on dispositions |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(191,988 |
) |
Other operating income,
net |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(400,000 |
) |
Interest expense |
|
6,620,251 |
|
|
|
6,791,219 |
|
|
|
26,914,045 |
|
|
|
26,456,236 |
|
Loss on extinguishment of
long-term debt |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
4,996,731 |
|
Gain on forgiveness of
long-term debt |
|
- |
|
|
|
(10,000,000 |
) |
|
|
- |
|
|
|
(10,000,000 |
) |
Other income, net |
|
(24,810 |
) |
|
|
(9,758 |
) |
|
|
(1,382,322 |
) |
|
|
(68,437 |
) |
Income tax benefit |
|
(14,368,073 |
) |
|
|
(903,970 |
) |
|
|
(18,242,719 |
) |
|
|
(5,321,630 |
) |
Equity in earnings of
unconsolidated affiliates, net of tax |
|
153,414 |
|
|
|
57,222 |
|
|
|
12,260 |
|
|
|
132,264 |
|
Earnings attributable to
noncontrolling interest |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(129,249 |
) |
SOI |
$ |
13,938,789 |
|
|
$ |
13,914,798 |
|
|
$ |
43,144,955 |
|
|
$ |
41,956,123 |
|
CONTACT: |
|
B. Caroline Beasley |
Joseph Jaffoni, Jennifer Neuman |
Chief Executive Officer |
JCIR |
Beasley Broadcast Group, Inc. |
212/835-8500 or bbgi@jcir.com |
239/263-5000 or ir@bbgi.com |
|
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