Cumulus Media(US:CMLS)2024-05-03 12:04PART I. FINANCIAL INFORMATION This section details the unaudited financial statements, management's analysis, market risk, and internal controls for Q1 2024 Financial Statements (Unaudited) For Q1 2024, Cumulus Media reported a net loss of $14.2 million on $200.1 million revenue, with total assets at $1.42 billion and a shift to $16.1 million operating cash outflow Condensed Consolidated Balance Sheets Balance Sheet Summary (in thousands) | Account | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $68,339 | $80,660 | | Total current assets | $276,241 | $286,897 | | Total assets | $1,418,533 | $1,440,301 | | Total current liabilities | $139,841 | $143,739 | | Total liabilities | $1,146,117 | $1,153,719 | | Total stockholders' equity | $272,416 | $286,582 | Condensed Consolidated Statements of Operations Statement of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Net revenue | $200,053 | $205,692 | | Operating (loss) income | $(10,474) | $1,035 | | Net loss | $(14,154) | $(21,467) | | Basic and Diluted loss per share | $(0.85) | $(1.17) | - The company recognized other income of $14.8 million in Q1 2024 from the sale of its equity in Broadcast Music, Inc. (BMI)1845197 Condensed Consolidated Statements of Cash Flows Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(16,107) | $23,658 | | Net cash provided by (used in) investing activities | $6,736 | $(75) | | Net cash used in financing activities | $(2,950) | $(12,133) | | (Decrease) increase in cash and cash equivalents | $(12,321) | $11,450 | | Cash and cash equivalents at end of period | $68,339 | $118,883 | Notes to Condensed Consolidated Financial Statements The notes detail the company's revenue streams, debt structure, equity plans, and significant events, including a major debt restructuring post-quarter end Net Revenue by Source (in thousands) | Revenue Source | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Broadcast Radio (Spot & Network) | $139,735 | $148,010 | | Digital | $34,447 | $32,089 | | Other | $25,871 | $25,593 | | Total Net Revenue | $200,053 | $205,692 | - On February 21, 2024, the Board adopted a shareholder rights plan (a "poison pill") to protect against a hostile takeover, expiring on February 20, 2025 unless redeemed or exchanged earlier9497 - As of March 31, 2024, the company had $25.0 million remaining under its authorized share repurchase program, expiring on May 15, 2025, with no shares repurchased in Q1 202498128127 - Subsequent to quarter end, on May 2, 2024, the company completed a major debt restructuring, exchanging approximately $325.7 million of 6.75% Senior Notes for new 8.000% Senior Notes due 2029 and approximately $328.3 million of Term Loan due 2026 for a new Term Loan due 2029158160 Management's Discussion and Analysis (MD&A) Management attributes the 2.7% revenue decrease to macroeconomic conditions, leading to an 18.6% Adjusted EBITDA decline and $16.1 million cash used in operations, with a major debt exchange completed post-quarter Results of Operations Financial Performance Summary (in thousands) | Metric | Q1 2024 | Q1 2023 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Net revenue | $200,053 | $205,692 | $(5,639) | (2.7)% | | Operating (loss) income | $(10,474) | $1,035 | $(11,509) | N/A | | Net loss | $(14,154) | $(21,467) | $7,313 | 34.1% | | Adjusted EBITDA | $8,405 | $10,329 | $(1,924) | (18.6)% | - The revenue decrease was primarily driven by reductions in spot revenue ($7.1 million) and network revenue ($1.1 million) due to macroeconomic conditions, partially offset by a $2.4 million increase in digital advertising revenue167 - Content costs decreased by $3.6 million (4.1%) due to reduced spending on third-party station inventory and lower syndicated programming costs, corresponding with the revenue decline168 - Corporate expenses increased by $1.8 million (13.0%), primarily due to higher restructuring expenses in 2024171 Liquidity and Capital Resources - As of March 31, 2024, the company had $68.3 million in cash and cash equivalents, with net cash used in operating activities at $16.1 million for Q1 2024, a significant decrease from the $23.7 million provided in Q1 2023, primarily due to working capital changes and reduced operating results201188 - Net cash provided by investing activities was $6.7 million in Q1 2024, mainly from the $14.8 million proceeds of the BMI sale, partially offset by capital expenditures21322 - Net cash used in financing activities decreased to $3.0 million in Q1 2024 from $12.1 million in Q1 2023, with 2023 including debt repurchases and treasury stock purchases, while 2024 usage was mainly for financing obligations and tax payments on vested stock190215 - In May 2024, subsequent to the quarter, the company amended its Revolving Credit Facility, extending the maturity to March 2029 and increasing the aggregate commitment to $125.0 million140206 Quantitative and Qualitative Disclosures about Market Risk As a smaller reporting company, the company is not required to provide market risk disclosures - As a smaller reporting company defined by Rule 12b-2 of the Exchange Act, the company is not required to provide disclosures about market risk2 Controls and Procedures Management concluded disclosure controls were effective as of March 31, 2024, with no material changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of March 31, 2024224 - No material changes were made to the company's internal control over financial reporting during the first quarter of 2024218 PART II. OTHER INFORMATION This section covers legal proceedings and updates on risk factors for the reporting period Legal Proceedings No additional material legal proceedings or developments were reported since the 2023 Annual Report on Form 10-K - No material developments in legal proceedings were reported for the period225 Risk Factors No material changes to the company's previously disclosed risk factors occurred during the three months ended March 31, 2024 - No material changes to the risk factors disclosed in the 2023 Form 10-K occurred during Q1 2024226