Urban One(US:UONE)2024-11-12 22:20Revenue Performance - For the three months ended September 30, 2024, net revenues were approximately $110.4 million, a decrease of 6.3% from $117.8 million in the same period of 2023[169]. - Radio advertising revenue for the three months ended September 30, 2024, was $44.99 million, down 3.6% from $46.65 million in the prior year[159]. - Political advertising revenue increased significantly by 222.2%, reaching $3.55 million compared to $1.10 million in the same period last year[159]. - Digital advertising revenue decreased by 4.1%, totaling $19.43 million compared to $20.27 million in the previous year[159]. - Cable television advertising revenue fell by 13.3%, amounting to $21.87 million, down from $25.22 million in the prior year[159]. - Net revenue for the nine months ended September 30, 2024, was approximately $332.5 million, a decrease of $24.8 million or 6.9% compared to $357.3 million for the same period in 2023[187]. - Revenue from the Radio Broadcasting segment increased by approximately $3.5 million to $118.1 million, driven by local political advertising and the acquisition of a Houston station[187]. - Revenue from the Reach Media segment decreased by approximately $4.5 million to $37.6 million, primarily due to decreased demand and advertiser attrition[187]. Operating Expenses and Losses - Total operating expenses decreased by 21.5% to $136.59 million from $173.94 million in the same period last year[167]. - The operating loss for the three months ended September 30, 2024, was $26.20 million, a significant improvement from a loss of $56.11 million in the prior year[167]. - Operating loss for the nine months ended September 30, 2024, was approximately $73.7 million, an increase of $35.4 million or 92.3% compared to a loss of $38.3 million in 2023[187]. - Total operating expenses for the nine months ended September 30, 2024, were approximately $406.3 million, an increase of $10.6 million or 2.7% compared to $395.7 million in 2023[187]. Net Loss and Income - The net loss attributable to common stockholders for the three months ended September 30, 2024, was $31.80 million, compared to a loss of $54.41 million in the same period of 2023, reflecting a 41.6% improvement[167]. - Net loss attributable to common stockholders for the three months ended September 30, 2024, was $(31,798) thousand, compared to $(54,411) thousand for the same period in 2023[210]. - Net income attributable to non-controlling interests was approximately $0.3 million for the three months ended September 30, 2024, down 52.1% from $0.7 million in 2023[183]. - Net income attributable to non-controlling interests was approximately $1.0 million for the nine months ended September 30, 2024, down from $2.0 million in 2023, a decrease of 51.2%[200]. Expenses Breakdown - Programming and technical expenses were approximately $33.9 million for both the three months ended September 30, 2024, and 2023, indicating no change[170]. - Selling, general and administrative expenses increased by approximately $1.0 million to $41.1 million for the three months ended September 30, 2024, compared to $40.1 million in the same period of 2023, a rise of 2.4%[172]. - Corporate selling, general and administrative expenses rose by approximately $1.9 million to $12.4 million for the three months ended September 30, 2024, reflecting an increase of 18.6% compared to $10.4 million in 2023[173]. - Stock-based compensation expense decreased by approximately $1.1 million to $1.2 million for the three months ended September 30, 2024, a decline of 48.1% from $2.2 million in 2023[174]. - Depreciation and amortization expense decreased by approximately $0.6 million to $1.2 million for the three months ended September 30, 2024, compared to $1.8 million in 2023[175]. - Selling, general and administrative expenses increased by approximately $4.5 million or 3.6% to $131.1 million, driven by higher payroll and research costs related to the Houston station acquisition[189]. - Stock-based compensation expense decreased by approximately $4.2 million or 53.7% to $3.6 million, primarily due to the timing of vesting of stock awards[191]. Impairment and Gains - Impairment of goodwill and intangible assets was approximately $46.8 million for the three months ended September 30, 2024, down 45.2% from $85.4 million in 2023[176]. - Impairment of goodwill and intangible assets was approximately $127.6 million, an increase of $3.3 million or 2.6% compared to $124.3 million in 2023[193]. - The company recorded a gain on retirement of debt of approximately $3.5 million for the three months ended September 30, 2024, compared to no gain in the same period of 2023[179]. - The company reported a gain on retirement of debt of approximately $18.8 million for the nine months ended September 30, 2024, compared to $2.4 million for the same period in 2023, representing a 696.7% increase[196]. Cash Flow and Liquidity - Cash, cash equivalents, and restricted cash balance was approximately $115.5 million as of September 30, 2024, with no borrowings outstanding on the Current ABL Facility[215]. - Net cash flows provided by operating activities were approximately $1.9 million for the nine months ended September 30, 2024, a decrease from $43.3 million in the same period of 2023[236]. - Net cash flows used in investing activities were approximately $(1.7) million for the nine months ended September 30, 2024, compared to $79.3 million in 2023, primarily driven by the sale of the MGM investment in 2023[238]. - Net cash flows used in financing activities were approximately $(118.2) million for the nine months ended September 30, 2024, compared to $(28.3) million in 2023, including repurchases of approximately $104.8 million of 2028 Notes[239]. Debt and Financing - The company repurchased approximately $125.0 million of its 2028 Notes at an average price of approximately 83.8% of par during the nine months ended September 30, 2024, resulting in a net gain on retirement of debt of approximately $18.8 million[227]. - The Current ABL Facility provides for up to $50.0 million in revolving loan borrowings, with no balance outstanding as of September 30, 2024[228]. - The Company is subject to speculative-grade credit ratings, which may impact borrowing costs and financing availability[240]. - The Company had approximately $600.0 million of 2028 Notes outstanding as of September 30, 2024, with no other indebtedness reported[259]. Impairment Assessments - The Company recognized an impairment loss of approximately $37.7 million associated with 9 radio markets within the Radio Broadcasting segment for the three months ended September 30, 2024[244]. - As of September 30, 2024, the fair value of one reporting unit exceeded its carrying value by less than 10%, indicating potential risk for future impairment assessments[250]. - The Company performed a quantitative impairment assessment for broadcasting licenses, utilizing a discounted cash flow analysis across 13 radio markets[243]. - The Company recorded an impairment charge of $37.7 million for broadcasting licenses and an impairment loss of approximately $9.1 million for the TV One trade name[252][253]. - The discount rate used in the impairment assessment for the TV One trade name was 11.0%, with a revenue growth rate range of (10.3)% to (0.1)% and a terminal growth rate of (1.5)%[255]. Other Financial Information - Total scheduled contractual obligations as of September 30, 2024, amounted to approximately $936.5 million, with $86.3 million not recorded on the balance sheet due to not meeting recognition criteria[268]. - The Company is engaged in ongoing renewal negotiations for performing rights organization licenses, which could impact music license fees[260][261]. - Reach Media increased its ownership interest to 90% after repurchasing 50% of the non-controlling interest shareholders' shares on March 8, 2024[266]. - The fair value of the Employment Agreement Award was estimated at approximately $13.5 million as of September 30, 2024, down from $23.0 million as of December 31, 2023[256]. - The Company has non-cancelable operating leases expiring over the next forty-eight years for various facilities[263]. - The Company entered into a new agreement regarding the Fantastic Voyage effective August 12, 2024, for cruises starting in 2025[269]. - The Company has a letter of credit capacity of up to $5.0 million under the Current ABL Facility, subject to certain limitations[270].