Beasley Broadcast(BBGI) - 2025 Q2 - Quarterly Report

PART I FINANCIAL INFORMATION Item 1. Condensed Consolidated Financial Statements Presents unaudited condensed consolidated financial statements, including balance sheets, net loss, cash flows, and detailed notes on accounting, dispositions, debt, and segments Condensed Consolidated Balance Sheets (Unaudited) | Metric | December 31, 2024 | June 30, 2025 | Change ($) | Change (%) | | :-------------------------------- | :------------------ | :-------------- | :--------- | :--------- | | Total assets | $549,206,825 | $548,037,975 | $(1,168,850) | -0.21% | | Total liabilities | $401,987,118 | $403,514,078 | $1,526,960 | 0.38% | | Total stockholders' equity | $147,219,707 | $144,523,897 | $(2,695,810) | -1.83% | | Cash and cash equivalents | $13,772,720 | $13,723,924 | $(48,796) | -0.35% | | Assets held for sale | — | $7,316,486 | $7,316,486 | N/A | - The company reclassified $7,185,620 in FCC licenses to assets held for sale as of June 30, 2025, related to the agreement to sell WPBB-FM in Tampa, FL[19][20] Condensed Consolidated Statements of Net Loss (Unaudited) - Three Months Ended June 30 | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2025 | Change ($) | Change (%) | | :----------------------------------- | :------------------------------- | :------------------------------- | :--------- | :--------- | | Net revenue | $60,435,657 | $52,999,711 | $(7,435,946) | -12.3% | | Operating expenses | $49,347,793 | $44,750,198 | $(4,597,595) | -9.3% | | Operating income | $5,375,199 | $2,891,256 | $(2,483,943) | -46.2% | | Interest expense | $(6,092,829) | $(3,294,772) | $2,798,057 | -45.9% | | Net loss | $(276,021) | $(154,175) | $121,846 | -44.1% | | Basic and diluted net loss per share | $(0.18) | $(0.09) | $0.09 | -50.0% | - Net loss decreased by 44.1% for the three months ended June 30, 2025, primarily due to a significant reduction in interest expense and a gain on repurchase of long-term debt, despite a decrease in net revenue and operating income[13][66][71] Condensed Consolidated Statements of Net Loss (Unaudited) - Six Months Ended June 30 | Metric | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Change ($) | Change (%) | | :----------------------------------- | :----------------------------- | :----------------------------- | :--------- | :--------- | | Net revenue | $114,816,003 | $101,912,176 | $(12,903,827) | -11.2% | | Operating expenses | $98,588,791 | $89,991,459 | $(8,597,332) | -8.7% | | Operating income | $4,272,113 | $890,667 | $(3,381,446) | -79.1% | | Interest expense | $(11,680,137) | $(6,675,414) | $5,004,723 | -42.8% | | Gain on sale of investment | $6,026,776 | — | $(6,026,776) | -100.0% | | Net loss | $(268,051) | $(2,843,996) | $(2,575,945) | 961.0% | | Basic and diluted net loss per share | $(0.18) | $(1.59) | $(1.41) | 783.3% | - Net loss significantly increased by 961.0% for the six months ended June 30, 2025, primarily due to the absence of a $6.0 million gain on sale of investment recognized in the prior year, despite reductions in net revenue and operating expenses[14][73][78][79] Condensed Consolidated Statements of Cash Flows (Unaudited) | Metric | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Change ($) | | :------------------------------------ | :----------------------------- | :----------------------------- | :--------- | | Net cash provided by (used in) operating activities | $2,555,826 | $(419,923) | $(2,975,749) | | Net cash provided by investing activities | $4,041,925 | $1,373,169 | $(2,668,756) | | Net cash used in financing activities | $(37,485) | $(1,002,042) | $(964,557) | | Net increase (decrease) in cash and cash equivalents | $6,560,266 | $(48,796) | $(6,609,062) | - The company shifted from net cash provided by operating activities ($2.6 million) in 2024 to net cash used in operating activities ($0.4 million) in 2025, primarily due to decreased cash receipts from revenue, partially offset by lower operating expenses and interest payments[15][93] - Net cash provided by investing activities decreased significantly, mainly due to the absence of $6.0 million from the sale of an investment in 2024, partially offset by proceeds from property and equipment dispositions in 2025[15][94] Notes to Condensed Consolidated Financial Statements (1) Interim Financial Statements - The unaudited condensed consolidated financial statements are prepared in accordance with U.S. GAAP for interim financial information and Form 10-Q instructions, reflecting all necessary normal and recurring adjustments. Results are subject to seasonal fluctuations and may not indicate full-year performance[16] (2) Recent Accounting Pronouncements - New FASB guidance in November 2024 requires disclosure of specific cost and expense information (inventory purchases, employee compensation, depreciation, amortization) effective for annual periods after December 15, 2026, and interim periods after December 15, 2027[17] - FASB guidance from December 2023 mandates additional disclosures for income tax rate reconciliation and income taxes paid, effective for fiscal years beginning after December 15, 2024[18] (3) Disposition - On June 27, 2025, the Company agreed to sell WPBB-FM assets in Tampa, FL for $8.0 million cash, pending FCC approval, expected to close in Q3 or Q4 2025[19][48] | Assets Held for Sale (June 30, 2025) | Amount | | :--------------------------- | :------- | | Property and equipment, net | $130,866 | | FCC license | $7,185,620 | | Total | $7,316,486 | (4) FCC Licenses | FCC Licenses | Amount | | :-------------------------------- | :------------- | | Balance as of December 31, 2024 | $392,259,831 | | Assets held for sale reclassification | $(7,185,620) | | Balance as of June 30, 2025 | $385,074,211 | (5) Proceeds from BMI Sale - On March 8, 2024, the Company received $6.0 million from the sale of its investment in Broadcast Music, Inc. (BMI), recording a $6.0 million gain and no longer holding an investment in BMI[21][78] (6) Long-Term Debt | Long-Term Debt Component | December 31, 2024 | June 30, 2025 | | :----------------------------------- | :------------------ | :-------------- | | Current portion of 8.625% secured notes | — | $2,795,000 | | 8.625% secured notes due Feb 1, 2026 | $4,295,000 | — | | 11.000% senior secured first lien notes due Aug 1, 2028 | $30,899,000 | $30,899,000 | | 9.200% senior secured second lien notes due Aug 1, 2028 | $184,922,000 | $184,922,000 | | Unamortized premium | $27,001,717 | $23,234,035 | | Total Long-Term Debt | $247,117,717 | $239,055,035 | - In October 2024, the Company completed a debt restructuring, exchanging $194.7 million of Prior Notes for new 9.200% Senior Secured Second Lien Notes and 11.000% Senior Secured First Lien Notes, and purchasing $68.0 million of Prior Notes[23][83] - In Q2 2025, the Company repurchased $1.5 million principal amount of Prior Notes for 65% of face value, resulting in a $0.5 million gain[27][70][78][87] (7) Stockholders' Equity | Stockholders' Equity Changes | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | | :--------------------------- | :----------------------------- | :----------------------------- | | Beginning balance | $148,978,635 | $147,219,707 | | Stock-based compensation | $415,052 | $175,228 | | Purchase of treasury stock | $(37,485) | $(27,042) | | Net loss | $(268,051) | $(2,843,996) | | Ending balance | $149,088,151 | $144,523,897 | (8) Net Revenue | Revenue Segment | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | | :-------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Audio | $47,430,080 | $39,818,870 | $90,858,207 | $77,972,240 | | Digital | $13,005,577 | $13,180,841 | $23,957,796 | $23,939,936 | | Total Net Revenue | $60,435,657 | $52,999,711 | $114,816,003 | $101,912,176 | - Audio revenue decreased by 16.0% for the three months and 14.2% for the six months ended June 30, 2025, primarily due to a decrease in agency revenue. Digital revenue remained comparable across both periods[29][67][74] - Revenue is recognized when performance obligations are satisfied, typically when commercial spots air or digital items are used for advertising content. Deferred revenue as of June 30, 2025, was $3,989,621[29][32] (9) Stock-Based Compensation - Stockholders approved the 2025 Equity Incentive Award Plan on June 25, 2025, allowing for the issuance of up to 300,000 Class A common shares in equity-based awards, replacing the 2007 Plan[33][47] | Restricted Stock Unit Activity (2007 Plan) | Units | Weighted Average Grant-Date Fair Value | | :----------------------------------- | :---- | :----------------------------------- | | Unvested as of April 1, 2025 | 78,126 | $13.55 | | Vested | (14,650) | $20.61 | | Forfeited | (3,050) | $10.50 | | Unvested as of June 30, 2025 | 60,426 | $11.99 | - As of June 30, 2025, there was $0.7 million in unrecognized compensation cost for restricted stock units under the 2007 Plan, expected to be recognized over a weighted-average period of 2.2 years[35] (10) Income Taxes | Period | Effective Tax Rate 2024 | Effective Tax Rate 2025 | | :-------------------------- | :---------------------- | :---------------------- | | Three months ended June 30 | 21% | 144% | | Six months ended June 30 | 64% | 31% | - The effective tax rates differ from the federal statutory rate of 21% due to state income taxes and certain non-deductible expenses[36][71][79] (11) Net Loss Per Share | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss | $(276,021) | $(154,175) | $(268,051) | $(2,843,996) | | Weighted-average shares outstanding (Basic & Diluted) | 1,517,710 | 1,794,754 | 1,517,001 | 1,793,399 | | Net loss per Class A and Class B common share – basic and diluted | $(0.18) | $(0.09) | $(0.18) | $(1.59) | - Weighted-average shares outstanding for June 30, 2024, were retroactively adjusted for a 1-for-20 Reverse Stock Split on September 23, 2024[37] - Restrictive stock units were excluded from diluted EPS calculations as their inclusion would be anti-dilutive due to the net loss[38] (12) Financial Instruments - The carrying amount of financial instruments like cash, accounts receivable, and accounts payable approximates fair value due to their short-term nature[39] | Financial Instrument | December 31, 2024 (Fair Value) | June 30, 2025 (Fair Value) | | :------------------- | :----------------------------- | :--------------------------- | | Company's Notes | $136.5 million | $104.0 million | - The estimated fair value of the Company's Notes decreased from $136.5 million at December 31, 2024, to $104.0 million at June 30, 2025, using Level 2 measurements[40] (13) Segment Information - The Company operates two reportable segments: Audio (radio stations in various US markets) and Digital (digital advertising sales). Corporate expenses are not allocated to segments[41] | Segment Net Revenue (Three Months Ended June 30) | 2024 | 2025 | Change ($) | Change (%) | | :--------------------------------------- | :--- | :--- | :--------- | :--------- | | Audio | $47,430,080 | $39,818,870 | $(7,611,210) | -16.0% | | Digital | $13,005,577 | $13,180,841 | $175,264 | 1.3% | | Total | $60,435,657 | $52,999,711 | $(7,435,946) | -12.3% | | Segment Operating Income (Loss) (Three Months Ended June 30) | 2024 | 2025 | Change ($) | Change (%) | | :----------------------------------------------- | :--- | :--- | :--------- | :--------- | | Audio | $6,366,509 | $3,287,219 | $(3,079,290) | -48.4% | | Digital | $3,074,242 | $3,494,474 | $420,232 | 13.7% | | Corporate | $(4,065,552) | $(3,890,437) | $175,115 | -4.3% | | Total Operating Income | $5,375,199 | $2,891,256 | $(2,483,943) | -46.2% | (14) Subsequent Events - On August 11, 2025, the Company agreed to sell WRXK-FM and WXKB-FM in Fort Myers, FL for $9.0 million cash, and WBCN-AM, WJPT-FM, and WWCN-FM in Fort Myers, FL for another $9.0 million cash[44][49] - These sales, subject to FCC approval, are expected to close in Q4 2025, after which the Company will cease operations in the Fort Myers-Naples, FL market[44][49] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses financial condition, operations, recent developments, forward-looking statements, Q2 and H1 2025 performance, liquidity, and debt General - Beasley Broadcast Group, Inc. is a multi-platform media company primarily operating radio stations across various US markets, offering integrated marketing solutions via audio, digital, and event platforms[46] Recent Developments - Stockholders approved the 2025 Equity Incentive Award Plan on June 25, 2025, authorizing up to 300,000 Class A common shares for equity awards, replacing the 2007 Plan[47] - The Company entered agreements to sell WPBB-FM in Tampa, FL for $8.0 million (June 27, 2025) and multiple stations in Fort Myers, FL (WRXK-FM, WXKB-FM, WBCN-AM, WJPT-FM, WWCN-FM) for $18.0 million ($9.0 million each) on August 11, 2025. These sales are subject to FCC approval and expected to close in Q3/Q4 2025[48][49] Cautionary Note Regarding Forward-Looking Statements - The report contains forward-looking statements subject to known and unknown risks and uncertainties, and actual results may differ materially from expectations[50][51] - Key risk factors include compliance with Nasdaq listing standards, external economic conditions, competition, technological changes, FCC regulations, debt levels, and dependence on key market clusters[52][55] Financial Statement Presentation - Net revenue is primarily from commercial advertising sales (local and national) and digital advertising, influenced by advertising rates, audience share, market competition, and seasonal fluctuations[54][56][57][59] - Operating expenses consist of programming, engineering, sales, advertising, promotion, and general/administrative costs, managed through centralization and consolidation[60] - Critical accounting estimates, as described in the 2024 Form 10-K, involve significant estimation uncertainty and potential material impact on financial results, with no additional material changes in the current period[61][64] Three Months Ended June 30, 2025 Compared to the Three Months Ended June 30, 2024 | Metric | 2024 | 2025 | Change ($) | Change (%) | | :-------------------------- | :----------- | :----------- | :--------- | :--------- | | Net revenue | $60,435,657 | $52,999,711 | $(7,435,946) | -12.3% | | Operating expenses | $49,347,793 | $44,750,198 | $(4,597,595) | -9.3% | | Corporate expenses | $3,879,771 | $3,769,243 | $(110,528) | -2.8% | | Interest expense | $6,092,829 | $3,294,772 | $(2,798,057) | -45.9% | | Gain on repurchase of long-term debt | — | $525,000 | $525,000 | N/A | | Income tax expense (benefit) | $(75,986) | $283,990 | $359,976 | -473.7% | | Net loss | $276,021 | $154,175 | $(121,846) | -44.1% | - Net revenue decreased by $7.4 million (12.3%), primarily due to a $7.6 million decrease in Audio revenue, while Digital revenue remained comparable[67] - Operating expenses decreased by $4.6 million (9.3%), driven by $4.4 million in Audio operating expense reductions due to continued expense management[68] - Interest expense decreased by $2.8 million (45.9%) due to amortization of a deferred interest premium from the October 2024 debt restructure[69] Six Months Ended June 30, 2025 Compared to the Six Months Ended June 30, 2024 | Metric | 2024 | 2025 | Change ($) | Change (%) | | :-------------------------- | :------------ | :------------ | :---------- | :--------- | | Net revenue | $114,816,003 | $101,912,176 | $(12,903,827) | -11.2% | | Operating expenses | $98,588,791 | $89,991,459 | $(8,597,332) | -8.7% | | Corporate expenses | $8,287,603 | $7,788,705 | $(498,898) | -6.0% | | Interest expense | $11,680,137 | $6,675,414 | $(5,004,723) | -42.8% | | Gain on repurchase of long-term debt | — | $525,000 | $525,000 | N/A | | Gain on sale of investment | $6,026,776 | — | $(6,026,776) | -100.0% | | Income tax benefit | $486,216 | $1,283,737 | $797,521 | 164.0% | | Net loss | $268,051 | $2,843,996 | $2,575,945 | 961.0% | - Net revenue decreased by $12.9 million (11.2%), primarily due to a $12.9 million decrease in Audio revenue, with Digital revenue remaining comparable[74] - Operating expenses decreased by $8.6 million (8.7%), driven by expense management in both Audio ($6.4 million decrease) and Digital ($2.2 million decrease, partly due to the closure of Guarantee Digital in 2024)[75] - Net loss increased significantly by $2.6 million (961.0%), largely due to the absence of the $6.0 million gain on sale of investment recognized in 2024[73][78][79] Liquidity and Capital Resources Overview - Primary liquidity sources are internally generated cash flow and cash on hand. The Company expects to receive $26.0 million from asset sales in H2 2025[80] - Liquidity needs include working capital, debt service, general corporate purposes, and capital expenditures. The Board has suspended future quarterly dividend payments[80][81] Secured Notes - The Company's debt includes 8.625% senior secured notes due February 1, 2026, 11.000% Senior Secured First Lien notes due August 1, 2028, and 9.200% Senior Secured Second Lien notes due August 1, 2028[22][82][83] - A debt restructuring in October 2024 involved exchanging $194.7 million of Prior Notes for new notes and Class A Common Stock, and purchasing $68.0 million of Prior Notes[23][83] - New indentures for the First and Second Lien Notes contain restrictive covenants limiting the Company's ability to incur additional debt, pay dividends, make investments, sell assets, and other financial activities[24][25][84][85] Off-Balance Sheet Arrangements - The Company did not have any off-balance sheet arrangements as of June 30, 2025[90] Cash Flows | Cash Flow Activity (Six Months Ended June 30) | 2024 | 2025 | Change ($) | | :------------------------------------ | :----------- | :----------- | :--------- | | Net cash provided by (used in) operating activities | $2,555,826 | $(419,923) | $(2,975,749) | | Net cash provided by investing activities | $4,041,925 | $1,373,169 | $(2,668,756) | | Net cash used in financing activities | $(37,485) | $(1,002,042) | $(964,557) | | Net increase (decrease) in cash and cash equivalents | $6,560,266 | $(48,796) | $(6,609,062) | - Operating cash flow shifted from a $2.6 million inflow in 2024 to a $0.4 million outflow in 2025, primarily due to decreased revenue receipts partially offset by lower operating expenses and interest payments[93] - Investing cash flow decreased due to the absence of $6.0 million from an investment sale in 2024, partially offset by $2.7 million from property dispositions in 2025[94] Item 3. Quantitative and Qualitative Disclosures About Market Risk This item is not required for smaller reporting companies - The Company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk[96] Item 4. Controls and Procedures Management concluded disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the Company's disclosure controls and procedures were effective as of June 30, 2025[97] - There were no material changes in the Company's internal control over financial reporting during the quarter ended June 30, 2025[98] PART II OTHER INFORMATION Item 1. Legal Proceedings The Company faces routine litigation, including indecency claims, but management believes no current proceedings will materially affect financial condition or operations - The Company is involved in ordinary routine litigation and threats of litigation, including indecency claims at the FCC[100] - Management does not believe any current legal proceedings are likely to have a material adverse effect on the Company's financial condition or results of operations[100] Item 1A. Risk Factors There have been no material changes to the risk factors previously disclosed in the Company's annual report on Form 10-K for the year ended December 31, 2024 - No material changes to the Company's risk factors have occurred since the annual report on Form 10-K for the year ended December 31, 2024[101] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The Company repurchases Class A common stock to fund withholding taxes for restricted stock unit vesting, with 3,852 shares repurchased in Q2 2025 - The 2025 Plan and 2007 Plan permit the Company to purchase shares to fund withholding taxes for restricted stock unit vesting[102] | Period | Total Number of Shares Purchased | Average Price Paid per Share | | :----------------- | :----------------------------- | :--------------------------- | | April 1 – 30, 2025 | 650 | $5.96 | | May 1 – 31, 2025 | 492 | $6.00 | | June 1 – 30, 2025 | 2,710 | $4.10 | | Total | 3,852 | | Item 3. Defaults Upon Senior Securities The Company reported no defaults upon senior securities during the period - There were no defaults upon senior securities[104] Item 4. Mine Safety Disclosures This item is not applicable to the Company - Mine Safety Disclosures are not applicable to the Company[105] Item 5. Other Information No director or officer adopted, modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the three months ended June 30, 2025 - No director or officer adopted, modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the three months ended June 30, 2025[106] Item 6. Exhibits This section lists all exhibits filed with the Form 10-Q, including the 2025 Equity Incentive Award Plan, certifications from the CEO and CFO, and XBRL-related documents - Exhibits include the Beasley Broadcast Group, Inc. 2025 Equity Incentive Award Plan, forms of Director Restricted Stock Unit Agreement, and certifications from the CEO and CFO[107] - XBRL Instance Document, Taxonomy Extension Schema, and Cover Page Interactive Data File are also included as exhibits[107] SIGNATURES The report is duly signed on behalf of Beasley Broadcast Group, Inc. by Caroline Beasley, Chief Executive Officer, and Lauren Burrows Coleman, Chief Financial Officer, on August 13, 2025 - The report was signed by Caroline Beasley, Chief Executive Officer, and Lauren Burrows Coleman, Chief Financial Officer, on August 13, 2025[111]