Core Insights - The E.W. Scripps Company (SSP) and TEGNA (TGNA) are adapting to changes in the local media landscape with differing strategies for growth and cost management [1][2] Group 1: SSP Overview - SSP is expanding its local media segment through a station swap with Gray Media, acquiring KKTV, a CBS affiliate, to enhance its presence in the Western U.S. market [3][5] - The company is implementing centralized production and AI tools to improve operational efficiency and manage costs, while keeping employee costs low [4][6] - In Q1 2025, SSP's local media segment generated $325 million in revenues, with a segment profit of $35 million, supported by cost controls and sports programming partnerships [6] Group 2: TGNA Overview - TEGNA is focusing on building a stronger foundation through leadership changes, system upgrades, and a new sales performance structure, while utilizing resource sharing across stations [7] - The company faces challenges with soft consumer confidence and cautious advertising spending, which may impact its near-term advertising performance [8][10] - As of March 31, 2025, TEGNA reported total debt of $3.08 billion and a net leverage ratio of 2.8X, raising concerns about its financial flexibility [9][10] Group 3: Comparative Analysis - Valuation-wise, SSP shares are trading at a Price/Sales ratio of 0.12X, significantly lower than TGNA's 0.94X, indicating a cheaper valuation for SSP [11] - Year-to-date, SSP shares have increased by 41.2%, while TGNA shares have decreased by 8.6%, reflecting differing investor sentiments towards the two companies [13] - SSP is viewed as having better growth potential due to its active strategies and operational efficiency, while TEGNA is seen as struggling with weak demand and stagnant growth [18][19]

Financial Data and Key Metrics Changes - In Q1 2025, total net revenue decreased by 1% year over year to $98.7 million, within the guidance range of $98 million to $100 million [18] - Adjusted EBITDA increased by 3.5% year over year to $18.1 million, exceeding the guidance range of $17 million to $18 million [18] - Adjusted EBITDA margins expanded from 17.6% in Q1 2024 to 18.4% in Q1 2025 [18] Business Line Data and Key Metrics Changes - Digital revenue grew by 6% year over year, accounting for 57% of total net revenue in Q1 2025, the highest percentage achieved by the company [6][7] - Townsquare Ignite, the digital advertising segment, reported a net revenue increase of 7.6% year over year, with a profit margin of 21.5% [19] - Townsquare Interactive, the subscription-based digital marketing solutions segment, saw a segment profit increase of 22% year over year, with profit margins at approximately 32% [20] Market Data and Key Metrics Changes - The broadcast advertising net revenue, excluding political, declined by 8.3% year over year, while total broadcast revenue decreased by 9.1% [21] - The company continues to gain local and national broadcast market share, despite the overall decline in the broadcast market [16] Company Strategy and Development Direction - The company reaffirms its digital-first local media strategy, focusing on markets outside the top 50 in the U.S. as a competitive advantage [29] - The media partnership strategy is expected to generate $50 million in revenue within three to five years, contributing to the company's growth without significant capital investment [10][49] - The company plans to continue investing in digital product technology, sales, and content to maintain its competitive edge [24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate macroeconomic uncertainties and highlighted the strength of its digital platform as a growth engine [4][30] - The company anticipates continued growth in digital advertising revenue, with Q2 growth rates expected in the mid-single digits [10][25] - Management noted that the broadcast segment is viewed as a mature cash cow business, with expectations of continued revenue decline [15] Other Important Information - The company ended Q1 2025 with $6 million in cash, down from $27 million at year-end, primarily due to interest payments and refinancing fees [23] - The board approved a quarterly dividend of $0.20 per share, reflecting a yield of approximately 11.5% based on the current share price [25] Q&A Session Summary Question: Can you discuss the competitive landscape for Ignite and revenue from markets without radio stations? - Management highlighted that operating outside the top 50 markets provides a significant competitive advantage, with Ignite being a full-service digital agency [35][36] Question: What percentage of broadcast advertisers also buy digital solutions? - The majority of broadcast advertisers also purchase digital solutions, with over 85% engaging in both [40][43] Question: How does the company view potential deregulation in the broadcast industry? - Management is optimistic about deregulation, seeing it as an opportunity for both organic growth and potential acquisitions [46][49] Question: What is the growth potential for media partnerships outside the top 50 markets? - Management indicated significant growth potential, with hundreds of markets available for partnerships, contributing to future revenue growth [56][58] Question: How are interactive subscribers responding to current economic uncertainties? - Management noted a temporary pause in spending due to uncertainty, but recent months have shown improvement in revenue trends [60][64]

Financial Data and Key Metrics Changes - In Q1 2025, total net revenue decreased by 1% year over year to $98.7 million, within the guidance range of $98 million to $100 million [22] - Adjusted EBITDA increased by 3.5% year over year to $18.1 million, exceeding the guidance range of $17 million to $18 million [19][22] - Adjusted EBITDA margins expanded from 17.6% in Q1 2024 to 18.4% in Q1 2025 [19] Business Line Data and Key Metrics Changes - Digital revenue grew by 6% year over year, accounting for 57% of total net revenue in Q1 2025, the highest percentage achieved by the company [6][30] - Townsquare Ignite, the digital advertising segment, saw net revenue increase by 7.6% year over year, with a profit margin of 21.5% [20] - Townsquare Interactive, the subscription-based digital marketing solutions segment, returned to year-over-year profit growth with a 22% increase in segment profit [21] Market Data and Key Metrics Changes - Broadcast advertising net revenue, excluding political, declined by 8.3% year over year, while total broadcast revenue decreased by 9.1% [22] - The company continues to gain local and national broadcast market share, despite the overall decline in the broadcast market [17] Company Strategy and Development Direction - The company reaffirms its digital-first local media strategy, focusing on markets outside the top 50 in the U.S. as a competitive advantage [30][31] - The digital platform is viewed as the growth engine, with plans to invest heavily in digital solutions and technology [6][30] - The media partnership strategy is expected to generate $50 million in revenue over the next three to five years, with a profit margin of approximately 20% [11][50] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate macroeconomic uncertainties and continue delivering strong cash flow [5][30] - The company anticipates continued growth in digital advertising revenue, with year-over-year growth rates expected in the mid-single digits for Q2 2025 [11][20] - Management highlighted the importance of maintaining a strong competitive advantage through organic growth and strategic partnerships [49][60] Other Important Information - The company ended Q1 2025 with $6 million in cash, down from $33 million at year-end due to various payments, including interest and dividends [25] - The board approved a quarterly dividend of $0.20 per share, reflecting a yield of approximately 11.5% based on the current share price [27] Q&A Session Summary Question: Can you discuss the competitive landscape for Ignite and revenue from markets without radio stations? - Management emphasized the competitive advantage of operating outside the top 50 markets and highlighted the sophistication and scale of their digital advertising solutions [36][38] Question: What percentage of broadcast advertisers also buy digital solutions? - The majority of broadcast advertisers also utilize digital solutions, with over 85% engaging in both [42][46] Question: What are the company's thoughts on potential deregulation in the broadcast industry? - Management expressed excitement about deregulation opportunities, indicating that they could pursue both organic growth and acquisitions in markets outside the top 50 [48][52] Question: How widely penetrated do you expect the media partnership area to be in the future? - Management noted significant growth potential in partnering outside the top 50 markets, with hundreds of opportunities available [56][60] Question: How are interactive subscribers dealing with current economic uncertainties? - Management observed a temporary pause in spending due to uncertainty but noted a recovery in May and June, indicating improved confidence among clients [62][66]

Townsquare Media (TSQ) Q4 2024 Earnings Call March 17, 2025 08:00 AM ET Company Participants Claire Yenicay - Executive Vice President, Investor Relations and Corporate CommunicationsBill Wilson - Chief Executive OfficerStuart Rosenstein - Executive VP & CFOMichael Kupinski - Director of ResearchPatrick Sholl - Vice President Operator Good morning, and welcome to Townsquare Media's Fourth Quarter twenty twenty four Conference Call. At this time, all participants are in a listen only mode. A brief question a ...