NEW YORK, Feb. 25 /PRNewswire-FirstCall/ -- Hearst-Argyle
Television, Inc. (NYSE:HTV), today announced fourth quarter and
year ended December 31, 2008 loss per diluted share of $5.90 and
$5.52, respectively, after giving effect to a non-cash impairment
charge of $926 million pre-tax, $570 million after-tax, or about
$6.09 per share. In addition, during the fourth quarter the Company
recorded severance, certain other non-recurring charges and wrote
down certain investments. These non-recurring items amounted to
$14.3 million pre-tax, $10.2 million after-tax, or about $0.11 per
share. Results for the Year Ended December 31, 2008 For the year
ended December 31, 2008, total revenue of $720.5 million was down
4.7% compared to the year ended December 31, 2007, which primarily
reflects: -- Record net political revenue of $93.0 million compared
to $32.0 million in 2007; -- Retransmission consent fees of $26.9
million, an increase of 24.4% over 2007; -- A decrease in several
major categories including automotive, retail, telecommunications,
movies, restaurant, health services and furniture. Operating income
(loss) for the year was impacted by the impairment charge as well
as several items of note: -- Salaries, Benefits and Other operating
costs of $413.3 million included -- $5.7 million of severance
expenses, offset by -- a $4.7 million gain associated with the
Nextel equipment exchange. -- An $11.5 million insurance gain
associated with Hurricane Katrina; and -- Corporate, general and
administrative costs of $35.4 million; included approximately $0.8
million of non-recurring expenses associated with certain strategic
and IT initiatives. Net income (loss) was further impacted by: --
The write-down of two small investments which resulted in a
combined pre-tax charge of $7.8 million and after-tax charge of
$6.3 million; -- Tax benefits of $356.3 million related to the
impairment charge and $4.6 million of net tax benefits due to the
settlement of certain tax examinations, as well as the use of $2.5
million of capital loss carry forwards to offset the insurance
gain. Results for the Quarter Ended December 31, 2008 For the
quarter ended December 31, 2008, total revenue of $197.1 million
was down 9.0% compared to the quarter ended December 31, 2007,
which primarily reflects: -- Record net political revenue of $51.2
million, an increase of $32.5 million compared to 2007; --
Retransmission consent fees of $7.0 million, an increase of 28.1%
over 2007; -- A decrease in several major categories including the
automotive, retail, telecommunications, movies, restaurant, health
services and furniture; and -- A decrease in digital media revenues
related to the overall decline in category ad spending. Operating
income (loss) for the quarter was impacted by the impairment charge
as well as several items of note: -- Salaries, Benefits and Other
operating costs of $105.4 million included -- $5.7 million of
severance expenses, offset by -- a $1.2 million gain associated
with the Nextel equipment exchange. -- Corporate, general and
administrative costs of $8.0 million included approximately $0.8
million of non-recurring expenses discussed above. Net income
(loss) was further impacted by the investment write-downs and tax
benefits related to the impairment charge described above.
Management Discussion of Results Commenting on the announcement,
David Barrett, President and Chief Executive Officer, stated, "Our
operating results for 2008 are a reflection of the very challenging
economic environment that grips our domestic and global economies.
Notwithstanding the strong local competitive position enjoyed by
most of our stations, the severe downturn in ad spending - at both
the local and national level, from a broad cross section of ad
categories - resulted in a 4.7% decline in net revenues for the
full year of 2008. "Political revenues of $93 million were a record
high for our company, and certainly a highlight for us, as was our
continued growth in retransmission consent fees. Unfortunately,
depressed local economies in our largest markets and states such as
California and Florida, and further significant declines in auto
spending and other recession-sensitive categories, outweighed our
political and retransmission gains. Digital revenues, which got off
to a strong start earlier in the year, were also affected by
recessionary conditions, and were flat to prior year due to fourth
quarter weakness. "Throughout the year, we've been focused on
stringent cost management initiatives, and we've taken numerous
steps to restructure and right-size our operations appropriate to a
lowered revenue base. Included in our operating results is a $5.7
million severance charge that reflects steps taken in the fourth
quarter to reduce employment by approximately 200 positions.
"Adjusted EBITDA of $207.1 million declined 11% from 2007, but we
nevertheless generated meaningful Free Cash Flow of $158.0 million
during the year, using our cash resources to reduce our debt
balance by $136.0 million. "On a relative basis, our healthy
Adjusted EBITDA, our demonstrated ability to generate positive cash
flow, and our still strong balance sheet, are collective indicators
of a company well positioned and well prepared to work its way
through this difficult recessionary period, and emerge with
strengthened shares of audience, revenue and profitability. "As we
consider our efforts and accomplishments in 2008, we are pleased
that six stations achieved record revenues. The quality of our
product - on-air, on-line, and on newer on-demand mobile platforms
- is a priority for us, and we will continue to allocate resources
to achieve leadership in a three-screen world. "Looking at 2009, it
is evident that recessionary conditions will continue to challenge
us, resulting in further declines in ad spending. We've taken
aggressive steps to introduce new revenue and programming
initiatives on multi-platforms, and our 2008 cost management
actions, along with further steps we are undertaking in 2009, will
help mitigate some, but not all, of the economic pressures we are
facing. We are taking proactive steps to conserve cash for further
debt reduction, including significant curtailment in capital
spending and the suspension of our dividend. "I remain confident
that our stations will continue to be premier local media
franchises in our markets as we adapt to new technologies and new
business model realities. Our strength of local brands, and the
rich viewer proposition that we offer to our viewers on-air,
on-line and on-demand every day, are fundamentally important to our
future success." Broadcast Audience Delivery and Product Quality
Throughout the economic slowdown, we have continued to maintain our
product quality and to compete vigorously for audience share. Local
News Leadership -- 74% of HTV weekday newscasts ranked #1 or #2 in
their time periods (A25-54) during the November ratings period.
This is a 10% increase from one year ago. -- Seven stations ranked
#1 in household ratings for all weekday newscasts (morning, early
evening and late news): KCRA, WBAL, KMBC, WISN, WGAL, WXII and
KSBW. -- HTV launched "Project Economy," a company-wide initiative
focused on in-depth coverage of economic news. "Project Economy"
promises extended daily reports (on-air and on-line), in addition
to community outreach in the form of local job fairs. Primetime
Ratings Highlights: November 2008 -- 18 of 18 HTV network
affiliates in top 50 markets over-indexed their network's average
prime time ratings during the November ratings period. -- HTV
operates the top three ABC stations among the 50 largest markets:
KOCO (#1), KMBC (#2) and WPBF (#3). -- HTV stations comprised four
of the top ten NBC affiliates in top 50 markets: WBAL (#5), WXII
(#5), KCRA (#8) and WLWT (#10). Digital Media Initiatives We remain
focused on efficiently delivering compelling local news, weather
and entertainment content to our loyal audience on-line and on
portable devices. This has translated into healthy growth in
underlying web traffic metrics in the fourth quarter. Visits to our
station web sites from local users were up 9%, video streams grew
7% and visits to our mobile sites more than doubled on a year over
year basis. This continued traffic growth in the fourth quarter put
the cap on a record breaking year, as Hearst-Argyle surpassed the 2
billion annual page view mark, besting our previous best year by
17%. The success we enjoyed in terms of traffic growth was a
reflection of our use of the newly emerging digital platforms to
extend Hearst-Argyle Television's commitment to journalism and
localism. Highlights include: "Commitment 2008" was a two year
project to bring in depth coverage of local political races leading
up to the November 2008 elections. Commitment 2008 coverage
resulted in more than 1.3 million unique visitors to Hearst-Argyle
websites on election day - a 41% increase over the traffic we saw
during the November 7, 2006 coverage of mid-term elections. And the
depth of our coverage translated into longer visits as well, with
average time per visit up 73%. Our sites continue to be the premier
source for local coverage of severe weather events. December 2008
was our all time highest month in terms of traffic on the weather
sections to our sites, with 43 million page views, fueled by
storms, frigid temperatures and paralyzing power outages in the
Northeast. A growing number of local residents are turning to our
web and mobile sites to learn of storm trajectory, school closings
and the status of recovery efforts. We have made it easier for
users of our sites to join in the discussion about the events in
their community, with the launch of our "u local" capability. This
added functionality enables users to comment on stories and
contribute their own images and video for other visitors to enjoy.
Our Manchester, NH station, WMUR, saw thousands of users upload
photos and videos they captured to show the impact of a fierce
mid-December ice storm. We expanded our mobile presence, increasing
the companion WAP sites from 11 to 25. We added a mobile site
version that is optimized for iPhone viewing and have begun to add
news video clips. This build-out of our mobile presence reflects
our intention to make the breaking news and weather content we
author in our local markets available through any delivery platform
that has achieved significant mass. Retransmission Consent Revenue
HTV has successfully negotiated new retransmission consent
agreements which are expected to result in meaningful increases in
retransmission revenue going forward. In 2009, we expect
retransmission revenue to exceed $45.0 million, representing
significant growth from prior years: ($'s in thousands) 2005 2006
2007 2008 Retransmission Consent Revenue $6,800 $17,900 $21,600
$26,900 Liquidity and Capital Resources Notwithstanding the effects
of the recession and the resulting disappointing revenue and
earnings performance, relative to prior year and to our
expectations, $193.3 million of cash flow from operations and Free
Cash Flow of $158.0 million in 2008, gave the company significant
financial flexibility to further reduce debt. The reduction of
total debt (including the Note Payable to the Capital Trust) during
the year of $136 million allowed us to finish the year at a
leverage ratio (as defined in our bank agreement) of 3.7 times.
Including the 2007 reduction, our total pay down of debt for the
past 24 months has been over $210 million. Our $500 million bank
credit facility had $329 million outstanding at December 31, 2008.
This facility matures in April, 2010. We expect to replace or
refinance this facility in the coming months, the terms of which
are not known at this time. We will also address the next scheduled
pay down on our private debt of $90 million, due in December 2009,
in the process. Given the lack of visibility in this recessionary
environment, we expect to conserve capital resources in 2009
through significant reductions in operating expenses, corporate
expenses, capital expenditures and a suspension of the dividend. We
expect to make an approximate $11 million contribution to our
pension plan this year, an amount that is equal to or less than our
recorded pension expense in our GAAP income statement. 2008
Selected Expense and Cash Items Actual Outlook Expense Items 2008
2009 ------------- ---- ---- Salaries, Benefits and Other Operating
Expenses (SB&O) $413.3 $380.0 Amortization of Program Rights
$76.3 $75.0 Depreciation & Amortization $56.1 $53.0 Corporate
General & Administrative Expenses $35.4 $33.0 Cash Flow Items
--------------- Capital Expenditures $35.4 $15.0 Cash Taxes Paid
$7.7 $5.0 Dividends Paid $26.3 $6.6 * Annualized Dividends $26.3
$0.0 * Reflects dividend declared on December 11, 2008 and paid on
January 15, 2009. On February 24, 2009, the Board decided to
suspend the dividend. Non-GAAP Measures For a reconciliation of
non-GAAP financial measurements contained in this news release and
the accompanying income statements, please see the Supplemental
Disclosures table at the end of this release. About Hearst-Argyle
Hearst-Argyle Television, Inc. owns 26 television stations, and
manages an additional three television and two radio stations owned
by Hearst Corporation, in geographically diverse U.S. markets. The
Company's television stations reach approximately 21 million
households, or about 18% of U.S. television households, making it
one of America's largest television station groups. Hearst-Argyle
owns 12 and manages one ABC-affiliated station and is the largest
ABC affiliate group. Hearst-Argyle owns 10 NBC affiliates, making
it the second-largest NBC affiliate owner. Hearst-Argyle owns two
CBS affiliates. Also, Hearst-Argyle owns more than 30 Websites and
19 digital multicast channels providing news, weather and
entertainment programming. Hearst-Argyle Series A Common Stock
trades on the New York Stock Exchange under the symbol "HTV."
Hearst-Argyle's corporate Web address is
http://www.hearstargyle.com/. As of December 31, 2008, Hearst
Corporation owns an approximately 82% interest in Hearst-Argyle
Television, Inc. Effective as of July 1, 2008, HTV will file
federal tax returns and, where permitted, state tax returns on a
consolidated basis with Hearst as a result of Hearst's ownership of
at least 80% of HTV common stock. FORWARD-LOOKING STATEMENTS This
news release includes or incorporates forward-looking statements.
We base these forward-looking statements on our current
expectations and projections about future events. These
forward-looking statements generally can be identified by the use
of statements that include phrases such as "anticipate", "will",
"may", "likely", "plan", "believe", "expect", "intend", "project",
"forecast" or other such similar words and/or phrases. For these
statements, the Company claims the protection of the safe harbor
for forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995. The forward-looking statements
contained in this new release, concerning, among other things,
trends and projections involving revenue, income, earnings, cash
flow, liquidity, operating expenses, assets, liabilities, capital
expenditures, dividends and capital structure, involve risks and
uncertainties, and are subject to change based on various important
factors. Those factors include the impact on our operations from --
Changes in national and regional economies; -- Changes in
advertising trends and our advertisers' financial condition; -- Our
ability to service and refinance our outstanding debt and meet our
liquidity needs; -- Competition for audience, programming and
advertisers in the broadcast television markets we serve; --
Pricing fluctuations in local and national advertising; -- Changes
in Federal regulations that affect us, including changes in Federal
communications laws or regulations; -- Local regulatory actions and
conditions in the areas in which our stations operate; -- Our
ability to obtain quality programming for our television stations;
-- Successful integration of television stations we acquire; --
Volatility in programming costs, industry consolidation,
technological developments, and major world events; and --
Potential adverse effects if we are required to recognize
impairment charges or other accounting-related developments. These
and other matters may cause actual results to differ from those we
describe. We undertake no obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise. Hearst-Argyle Television, Inc.
Condensed Consolidated Statements of Operations Three Months Ended
Twelve Months Ended December 31, December 31,
---------------------------- ---------------------------- 2008 (1)
2007(1) 2006 (1) 2008 (1) 2007 (1) 2006 (1) -------- -------
-------- -------- -------- -------- (In thousands, except per (In
thousands, except per share data) share data) Total revenue (2)
$197,104 $216,561 $234,428 $720,491 $755,738 $785,402 Station
operating expenses: Salaries, benefits and other operating costs
105,387 104,904 103,587 413,302 409,977 399,578 Amortization of
program rights 18,698 18,562 19,567 76,296 75,891 68,601
Depreciation and amorti- zation 14,331 12,770 13,057 56,130 55,262
59,161 Impairment Loss 926,071 - - 926,071 - - Insurance Settlement
- - - (11,549) - (1,974) Corporate, general and administrative
expenses 8,020 9,225 8,497 35,363 38,427 31,261 ----- ----- -----
------ ------ ------ Operating income (loss) (875,403) 71,100
89,720 (775,122) 176,181 228,775 Interest expense 12,968 15,176
17,163 50,984 63,023 66,103 Interest income (8) (734) (1,248) (74)
(2,043) (6,229) Interest expense, net - Capital Trust - 2,438 2,438
8,586 9,750 9,750 Other expense 3,731 - - 3,731 - 2,501 ----- -- --
----- -- ----- Income (loss) before income taxes (892,094) 54,220
71,367 (838,349) 105,451 156,650 Income tax expense (benefit)
(344,720) 19,551 27,602 (332,011) 38,207 58,410 Equity in loss
(income) of affiliates, net of tax (3) 4,775 1,024 (381) 10,119
2,588 (483) ----- ----- ---- ------ ----- ---- Net income (loss)
(552,149) 33,645 44,146 (516,457) 64,656 98,723 ======== ======
====== ======== ====== ====== Income (loss) per common
share�??basic $(5.90) $0.36 $0.48 $(5.52) $0.69 $1.06 ====== =====
===== ====== ===== ===== Number of common shares used in the
calculation 93,611 93,582 92,871 93,559 93,490 92,745 ====== ======
====== ====== ====== ====== Income (loss) per common
share�??diluted $(5.90) $0.34 $0.46 $(5.52) $0.69 $1.06 ======
===== ===== ====== ===== ===== Number of common shares used in the
calculation (4) 93,611 99,376 98,971 93,559 94,299 93,353 ======
====== ====== ====== ====== ====== Dividends per common share
declared $0.07 $0.07 $0.07 $0.28 $0.28 $0.28 ===== ===== =====
===== ===== ===== Supplemental Financial Data: ---------------- Net
local & national ad revenue (excluding political) $122,965
$171,577 $160,809 $533,995 $629,835 $614,257 Net digital media
revenue 5,377 6,589 5,286 20,864 20,871 15,513 Net political
revenue 51,217 18,691 49,550 93,002 32,054 88,040 Network
compensation 1,775 2,054 2,942 8,158 9,312 9,810 Retransmission
consent revenue 7,030 5,486 4,557 26,907 21,634 17,908 Other
revenue 8,740 12,164 11,284 37,565 42,032 39,874 Supplemental
Non-GAAP Data (*): ------------ Adjusted EBITDA $64,999 $83,870
$102,777 $207,079 $231,443 $287,936 Free cash flow $58,383 $35,675
$23,951 $157,897 $79,942 $139,945 (*) See Supplemental Disclosures
Regarding Non-GAAP Financial Information at the end of this news
release. See accompanying notes on the following pages.
Hearst-Argyle Television, Inc. Condensed Consolidated Balance
Sheets December 31, 2008 December 31, 2007 -----------------
----------------- (In thousands) Assets Current assets: Cash and
cash equivalents $7,044 $5,964 Accounts receivable, net 121,746
164,764 Program and barter rights 63,492 65,097 Deferred income tax
asset 4,707 4,794 Other 5,169 5,698 ----- ----- Total current
assets 202,158 246,317 ------- ------- Property, plant and
equipment, net 296,470 305,971 ------- ------- Intangible assets,
net 1,581,315 2,513,340 --------- --------- Goodwill 789,526
816,728 ------- ------- Other assets: Deferred financing costs, net
6,706 8,000 Investments 26,974 41,948 Program and barter rights,
noncurrent 8,367 8,399 Other assets 2,198 18,273 ----- ------ Total
other assets 44,245 76,620 ------ ------ Total assets $2,913,714
$3,958,976 ========== ========== Liabilities and Stockholders'
Equity Current liabilities: Current portion of long-term debt
$90,000 $90,016 Accounts payable 12,982 15,103 Accrued liabilities
48,073 48,376 Program and barter rights payable 64,743 64,687
Payable to Hearst Corporation, net 9,482 5,747 Other 4,510 6,482
----- ----- Total current liabilities 229,790 230,411 -------
------- Program and barter rights payable, noncurrent 15,728 15,587
Long-term debt 701,110 703,110 Note payable to Capital Trust -
134,021 Deferred income tax liability 470,158 856,790 Other
liabilities 123,305 66,658 ------- ------ Total noncurrent
liabilities 1,310,301 1,776,166 --------- --------- Commitments and
contingencies Stockholders' equity: Preferred Stock - - Series A
common stock 571 573 Series B common stock 413 413 Additional
paid-in capital 1,347,833 1,336,786 Retained earnings 198,694
743,264 Accumulated other comprehensive loss, net (56,714) (12,580)
Treasury stock, at cost (117,174) (116,057) -------- -------- Total
stockholders' equity 1,373,623 1,952,399 --------- --------- Total
liabilities and stockholders' equity $2,913,714 $3,958,976
========== ========== Hearst-Argyle Television, Inc. Condensed
Consolidated Statements of Cash Flows For the years ended December
31, ------------------------------- 2008 2007 2006 ---- ---- ----
(In thousands) Operating Activities Net income $(516,457) $64,656
$98,723 Adjustments to reconcile net income to net cash provided by
operating activities: Depreciation 50,177 48,562 52,817
Amortization of intangible assets 5,954 6,700 6,344 Amortization of
deferred financing costs 1,294 1,648 1,742 Amortization of program
rights 76,296 75,891 68,601 Impairment loss 953,273 - - Deferred
income taxes (355,677) 22,233 9,391 Equity in loss (income) of
affiliates, net 10,119 2,588 (483) Provision for (benefit from)
doubtful accounts 3,101 2,482 916 Stock-based compensation expense
7,938 8,187 7,576 Insurance settlement (11,549) - - Business
interruption insurance proceeds 8,659 - - Non-cash gain on Nextel
equipment exchange (4,705) (2,293) - Loss on disposals 985 4 (465)
Other expense, net 3,731 - 2,501 Program payments (73,479) (73,565)
(67,817) Changes in operating assets and liabilities: Decrease
(increase) in Accounts receivable 39,917 (6,463) (7,728) Decrease
(increase) in Other assets 699 8,231 11,766 (Decrease) increase in
Accounts payable and accrued liabilities (3,821) (22,124) 14,811
(Decrease) increase in Other liabilities (3,136) (993) 1,689 ------
---- ----- Net cash provided by operating activities $193,319
$135,744 $200,384 -------- -------- -------- Investing Activities
Purchases of property, plant and equipment, net (35,422) (55,802)
(60,439) Proceeds from redemption of Capital Trust 4,021 - -
Acquisition of WKCF-TV - - (217,511) Cash proceeds from insurance
recoveries 2,890 1,000 5,654 Investment in affiliates and other,
net (3,392) (3,631) (10,597) ------ ------ ------- Net cash used in
investing activities $(31,903) $(58,433) $(282,893) --------
-------- --------- Financing Activities Borrowings on credit
facility 425,000 141,000 100,000 Repayments on credit facility
(337,000) - - Redemption of Notes Payable to Capital Trust
(134,021) - - Payments on private placement (90,000) (90,000)
(90,000) Dividends paid on common stock (26,289) (26,206) (25,954)
Series A Common Stock repurchases (1,091) (5,273) (2,780) Principal
payments & repurchase of long term debt - (125,000) (10,000)
Principal payments on capital lease obligations (16) (12) (48)
Proceeds from employee stock purchase plan & stock option
exercises 3,081 15,534 9,836 ----- ------ ----- Net cash (used in)
provided by financing activities $(160,336) $(89,957) $(18,946)
--------- -------- -------- Increase (decrease) in cash and cash
equivalents 1,080 (12,646) (101,455) Cash and cash equivalents at
beginning of period 5,964 18,610 120,065 ----- ------ ------- Cash
and cash equivalents at end of period $7,044 $5,964 $18,610 ======
====== ======= Supplemental Cash Flow Information: Cash paid during
the period for: Interest $50,237 $62,477 $65,144 ======= =======
======= Interest on Note payable to Capital Trust $8,586 $9,750
$9,750 ====== ====== ====== Taxes, net of refunds $7,691 $36,955
$38,518 ====== ======= ======= Non-cash investing and financing
activities: Accrued property, plant & equipment purchases
$1,397 $2,410 $3,790 ====== ====== ====== Notes to Consolidated
Statements of Operations (1) Results of operations for the three
and twelve months ended December 31, 2008, 2007 and 2006 include
(i) the results of our 25 television stations, which were owned for
the entire period presented, and the management fees derived by the
three television and two radio stations managed by us for the
entire period presented; and (ii) the results of operations of
WKCF-TV, after our acquisition of the station on August 31, 2006.
(2) Total revenue includes local & national, digital media and
political advertising revenue net of agency commission expense,
network compensation, retransmission consent revenue and other
revenue consisting primarily of trade and barter revenue. (3)
Primarily represents the Company's equity interests in the
operating results of Internet Broadcasting, Ripe Digital
Entertainment and other investments. (4) The Redeemable Convertible
Preferred Securities, which were redeemed in full in June 2008,
have no effect on dilutive EPS for the year ended December 31,
2008. For the years ended December 31, 2007 and 2006 the Company
was required to perform a dilution test for the Redeemable
Convertible Preferred Securities related to the Capital Trust which
was outstanding during those periods. This test considered only the
total number of shares that could be issued if converted and does
not consider either the conversion price or the share price of the
underlying common shares. For the years ended December 31, 2007 and
2006, approximately 5.13 million shares of Series A Common Stock to
be issued upon the conversion of 2,600,000 shares of Series B 7.5%
Redeemable Convertible Preferred Securities are not included in the
number of common shares used in the calculation of diluted EPS
because to do so would have been anti-dilutive. As a result of the
redemption of the Redeemable Convertible Preferred Securities, the
Company filed to dissolve the Capital Trust as of December 31,
2008. Hearst-Argyle Television, Inc. Supplemental Disclosures
Regarding Non-GAAP Financial Information Adjusted EBITDA In order
to evaluate the operating performance of our business, we use
certain financial measures, some of which are calculated in
accordance with accounting principles generally accepted in the
United States of America ("GAAP"), such as net income, and some of
which are not, such as adjusted earnings before interest, taxes,
depreciation and amortization ("adjusted EBITDA"). In order to
calculate the non-GAAP measure adjusted EBITDA, we exclude from net
income the financial items that we believe are less integral to the
day-to-day operation of our business. We have outlined below the
type and scope of these exclusions and the limitations on the use
of the adjusted EBITDA measure as a result of these exclusions.
Adjusted EBITDA is not an alternative to net income, operating
income, or net cash provided by operating activities, as calculated
and presented in accordance with GAAP. Investors and potential
investors in our securities should not rely on adjusted EBITDA as a
substitute for any GAAP financial measure. In addition, our
calculation of adjusted EBITDA may or may not be consistent with
that of other companies. We strongly urge investors and potential
investors in our securities to review the reconciliation presented
in the table below of adjusted EBITDA to net income, the most
directly comparable GAAP financial measure. We use the adjusted
EBITDA measure as a supplemental financial metric to evaluate the
performance of our business that, when viewed together with our
GAAP results and the accompanying reconciliations, we believe
provides a more complete understanding of the factors and trends
affecting our business than the GAAP results alone. Adjusted EBITDA
is a common alternative measure of financial performance used by
investors, financial analysts, and rating agencies. These groups
use adjusted EBITDA, along with other measures, to estimate the
value of a company, compare the operating performance of a company
to others in its industry, and evaluate a company's ability to meet
its debt service requirements. In addition, adjusted EBITDA is a
key financial measure for the Company's stockholders and financial
lenders, since the Company's current debt financing agreements
require the measurement of adjusted EBITDA, along with other
measures, in connection with the Company's compliance with debt
covenants. We define adjusted EBITDA as net income adjusted to
exclude the following line items presented in our consolidated
statements of income: interest expense; interest income, interest
expense, net - Capital Trust; income taxes; depreciation and
amortization; equity in income or loss of affiliates; other income
and expense; and non-recurring special charges. Set forth below are
descriptions of each of the financial items that have been excluded
from net income in order to calculate adjusted EBITDA as well as
the material limitations associated with using adjusted EBITDA
rather than net income, the most directly comparable GAAP financial
measure, when evaluating the operating performance of our core
operations. -- Interest expense, Interest income and Interest
expense, net - Capital Trust. By excluding these expenses, we are
better able to compare our core operating results with other
companies that have different financing arrangements and capital
structures. Nevertheless, the amount of interest we are required to
pay does reduce the amount of funds otherwise available for use in
our core business and therefore may be useful for an investor to
consider. -- Income tax expense. By excluding income taxes, we are
better able to compare our core operating results with other
companies that have different income tax rates. Nevertheless, the
amount of income taxes we incur does reduce the amount of funds
otherwise available for use in our core business and therefore may
be useful for an investor to consider. -- Depreciation and
amortization. By excluding these non-cash charges, we are better
able to compare our core operating results with other companies
that have different histories of acquiring other businesses.
Nevertheless, depreciation and amortization are important expenses
for investors to consider, even though they are non-cash charges,
because they represent generally the wear and tear on our property,
plant and equipment and the gradual decline in value over time of
our intangible assets with finite lives. Furthermore, depreciation
expense is affected by the level of capital expenditures we make to
support our core business and therefore may be useful for an
investor to consider. -- Impairment Loss. The impairment loss is a
non-recurring, non-cash item resulting from the write down of
intangibles and goodwill as part of our routine FAS 142 analysis.
Excluding the impairment loss provides investors with more
comparable information about our Company's operating performance.
-- Equity in loss (income) of affiliates, net. This is a non-cash
item which represents our proportionate share of income or loss
from affiliates in which we hold minority interests. As we do not
control these affiliates, we believe it is more appropriate to
evaluate the performance of our core business by excluding their
results. However, as we make investments in affiliates for purposes
which are strategic to the Company, the financial results of such
affiliates may be useful for an investor to consider. -- Other
expense and special charges. These are non-recurring items which
are unrelated to the operations of our core business and, when they
do occur, can fluctuate significantly from one period to the next.
By excluding these items, we are better able to compare the
operating results of our underlying, recurring core business from
one reporting period to the next. Nevertheless, the amounts and the
nature of these items may be useful for an investor to consider, as
they can be material and can sometimes increase or decrease the
amount of funds otherwise available for use in our core business.
The following tables provide a reconciliation of net income to
adjusted EBITDA in each of the periods presented: Three Months
Ended Years Ended December 31, December 31,
------------------------- -------------------------- 2008 2007 2006
2008 2007 2006 ---- ---- ---- ---- ---- ---- (In thousands) (In
thousands) Net income $(552,149) $33,645 $44,146 $(516,457) $64,656
$98,723 Add: Income tax expense (344,720) 19,551 27,602 (332,011)
38,207 58,410 Add: Equity in loss (income) of affiliates, net of
tax 4,775 1,024 (381) 10,119 2,588 (483) Add: Interest expense, net
- Capital Trust - 2,438 2,438 8,586 9,750 9,750 Add: Interest
expense 12,968 15,176 17,163 50,984 63,023 66,103 Less: Interest
income (8) (734) (1,248) (74) (2,043) (6,229) Add: Other expense
3,731 - - 3,731 - 2,501 Add: Impairment Charge 926,071 - - 926,071
- - Operating income 50,668 71,100 89,720 150,949 176,181 228,775
Add: Depreciation and amortization 14,331 12,770 13,057 56,130
55,262 59,161 ------ ------ ------ ------ ------ ------ Adjusted
EBITDA $64,999 $83,870 $102,777 $207,079 $231,443 $287,936 =======
======= ======== ======== ======== ======== Free Cash Flow In order
to evaluate the operating performance of our business, we use the
non-GAAP measure free cash flow. Free cash flow reflects our net
cash flow from operating activities less capital expenditures. Free
cash flow is a primary measure used not only internally by our
management, but externally by our investors, analysts and peers in
our industry, to value our operating performance and compare our
performance to other companies in our peer group. Our management
believes that free cash flow provides investors with useful
information concerning cash available to allow us to make strategic
acquisitions and investments, service debt, pay dividends, meet tax
obligations, and fund ongoing operations and working capital needs.
Free cash flow is also an important measure because it allows
investors to assess our performance in the same manner that our
management assesses our performance. However, free cash flow is not
an alternative to net cash flow provided by operating activities,
as calculated and presented in accordance with GAAP, and should not
be relied upon as such. Specifically, because free cash flow
deducts capital expenditures from net cash flow provided by
operating activities, investors and potential investors should
consider the types of events and transactions which are not
reflected in free cash flow. In addition, our calculation of free
cash flow may or may not be consistent with that of other
companies. We strongly urge investors and potential investors in
our securities to review the reconciliation presented in the table
below of free cash flow to net cash flow provided by operating
activities, the most directly comparable GAAP financial measure.
The following table provides a reconciliation of net cash flow
provided by operating activities to free cash flow in each of the
periods presented: Three Months Ended Years Ended December 31,
December 31, ---------------------- ------------------------ 2008
2007 2006 2008 2007 2006 ---- ---- ---- ---- ---- ---- (In
thousands) (In thousands) Net cash provided by operating activities
$67,100 $49,012 $46,102 $193,319 $135,744 $200,384 Less capital
expenditures 8,717 13,337 22,151 35,422 55,802 60,439 ----- ------
------ ------ ------ ------ Free cash flow $58,383 $35,675 $23,951
$157,897 $79,942 $139,945 ======= ======= ======= ======== =======
======== DATASOURCE: Hearst-Argyle Television, Inc. CONTACT: Harry
Hawks, Executive Vice President & CFO, +1-212-887-6823, , or
Ellen McClain, Vice President, Finance, +1-212-887-6825, , both of
Hearst-Argyle Television, Inc.; Tom Campo, Campo Communications,
LLC, for Hearst-Argyle Television, Inc., +1-212-590-2464, Web Site:
http://www.hearstargyle.com/
Copyright
Hearst Argyle Tv (NYSE:HTV)
Gráfico Histórico do Ativo
De Mai 2024 até Jun 2024
Hearst Argyle Tv (NYSE:HTV)
Gráfico Histórico do Ativo
De Jun 2023 até Jun 2024