Townsquare Media(US:TSQ)2025-11-10 11:12Revenue Performance - Net revenue decreased by $8.6 million, or 7.4%, primarily due to a $7.5 million decrease in Broadcast Advertising net revenue[141] - For the nine months ended September 30, 2025, net revenue decreased by $12.3 million, or 3.7%, driven by a $16.6 million decrease in Broadcast Advertising net revenue[141] - Digital Advertising net revenue increased by $3.2 million, or 2.7%, to $119.3 million for the nine months ended September 30, 2025[141] - Excluding political revenue, net revenue decreased by $7.4 million, or 2.3%, to $319.6 million for the nine months ended September 30, 2025[141] - Net revenue for the three months ended September 30, 2025, decreased by $8.6 million, or 7.4%, compared to the same period in 2024, primarily due to declines in Broadcast Advertising and Digital Advertising revenues[145] - For the nine months ended September 30, 2025, net revenue decreased by $12.3 million, or 3.7%, compared to the same period in 2024[158] - Net revenue for the nine months ended September 30, 2025, decreased by $12.3 million, or 3.7%, compared to the same period in 2024, primarily due to a $16.6 million decrease in Broadcast Advertising revenue[160] Operating Income and Expenses - Operating income decreased by $9.2 million for the three months ended September 30, 2025, primarily due to a $6.2 million increase in transaction and business realignment costs[141] - Broadcast Advertising reported operating income of $12.0 million for the three months ended September 30, 2025, a decrease of $0.9 million compared to the same period in 2024[141] - Total operating costs and expenses for the nine months ended September 30, 2025, decreased by $46.0 million, or 13.8%, compared to the same period in 2024[158] - Direct operating expenses for the three months ended September 30, 2025, decreased by $5.0 million, or 6.0%, with Broadcast Advertising expenses down by $4.9 million, or 12.8%[146] - Direct operating expenses for the nine months ended September 30, 2025, decreased by $8.8 million, or 3.6%, with Broadcast Advertising expenses down by $10.9 million, or 9.7%[161] Profitability and Impairments - Segment profit for the three months ended September 30, 2025, decreased by $3.5 million, or 11.2%, with Broadcast Advertising segment profit down by $2.6 million, or 16.3%[147] - Segment profit for the nine months ended September 30, 2025, decreased by $3.5 million, or 4.0%, with Broadcast Advertising segment profit down by $5.8 million, or 13.5%[162] - The company recognized a non-cash goodwill impairment charge of $3.0 million for the National Digital reporting unit for the three months ended September 30, 2025, due to declines in forecasted revenues[151] - The company incurred $1.5 million in impairment charges related to FCC licenses for four local markets during the nine months ended September 30, 2025, a significant decrease from $29.7 million in the same period in 2024[165] Debt and Financing - The Company entered into a $490 million Credit Agreement, including a $470 million Term Loan Facility and a $20 million Revolving Credit Facility[138] - The Company incurred approximately $5.5 million in fees and expenses related to the Senior Secured Credit Facility, which are being amortized over its term[139] - Interest expense for the three months ended September 30, 2025, increased to $12.6 million, up from $9.2 million in the same period in 2024, representing a 37.4% increase[155] - As of September 30, 2025, the company had $437.6 million of outstanding indebtedness, net of unamortized discount and deferred financing costs[183] - The company expects mandatory debt service requirements to be approximately $53.7 million over the next twelve months[184] Cash Flow and Liquidity - Net cash provided by operating activities was approximately $18.0 million for the nine months ended September 30, 2025, compared to $20.6 million for the same period in 2024[179] - Net cash used in investing activities was $3.4 million for the nine months ended September 30, 2025, a decrease from $7.6 million in the same period in 2024[180] - As of September 30, 2025, the company had $3.2 million in cash and cash equivalents, and $55.5 million in receivables from customers, with an average collection cycle of approximately 50 days[185] - The company anticipates that cash generated from operations will be sufficient to meet liquidity needs for at least the next 12 months, but future performance and cash flow are subject to various economic conditions[187] Strategic Outlook - The company believes its diversified product offering helps mitigate risks associated with advertising revenue dependency[126] - The company is evaluating strategic acquisitions and divestitures to enhance its competitive position and financial performance, which may require additional capital[188] - The company closely monitors capital and credit market conditions, as well as the financial condition of its customers, to assess potential impacts on operations[189] - There are no material off-balance sheet arrangements or transactions reported by the company[190] - The company makes significant estimates and judgments in preparing financial statements, which may change based on new events and information[192] - There have been no material changes to the critical accounting policies and estimates as filed in the 2024 Annual Report[193] Taxation - The effective tax rate for the three months ended September 30, 2025, was approximately 16.2%, a significant decrease from 82.6% in the same period in 2024[156] Stock-Based Compensation - Stock-based compensation expense decreased by $3.0 million, or 21.5%, for the nine months ended September 30, 2025, due to a non-recurring cash settlement of options in 2024[163]