Urban One(US:UONE)2024-08-11 12:27Financial Data and Key Metrics Changes - Consolidated net revenue decreased by 9.2% year-over-year to approximately $117.7 million for Q2 2024 [7] - Consolidated adjusted EBITDA was $28.4 million, down 24.2% [11] - Net loss was approximately $45.4 million or $0.94 per share, compared to net income of $70.4 million or $1.48 per share for Q2 2023 [12] Business Line Data and Key Metrics Changes - Radio broadcasting segment net revenue was $42 million, an increase of 7.2% year-over-year, but down 3% on a same-station basis [7] - Reach Media segment net revenue was $18.9 million, down 5.6% from the prior year [8] - Digital segment net revenues decreased by 16% to $15.9 million, with adjusted EBITDA down 52.5% [8] - Cable television segment revenue was approximately $41.5 million, a decrease of 20.9%, with advertising revenue down 26.7% [8] Market Data and Key Metrics Changes - Local advertising sales were down 8.5% against a market that was down 7.1% [7] - National ad sales were down 1.6% against a market that was up 7% [7] - Cable subscribers for TV One decreased from 40.7 million at the end of Q1 to 39.8 million at the end of Q2 [8] Company Strategy and Development Direction - The company is optimistic about political advertising, expecting stronger performance than previously forecasted [5] - A new ad server for connected TV is expected to go live in August, which will enhance monetization capabilities [22][23] - The company is focused on managing leverage and opportunistically buying back debt [17][28] Management's Comments on Operating Environment and Future Outlook - Management indicated that the company is likely to finish 2024 at the lower end of its EBITDA guidance of $110 million to $120 million [6] - There is ongoing softness in the cable television segment that needs to be addressed [5] - The management is cautious about M&A activities, emphasizing the need for deals to be both accretive and deleveraging [26] Other Important Information - The company repurchased $35.5 million of its 2028 notes at a price of 78% of par [12] - An impairment charge of $80.8 million was recorded, primarily from broadcasting licenses [12] - Total gross debt was $614.5 million, with a net leverage ratio of 4.37x [13] Q&A Session Summary Question: Comments on the digital segment's performance and future expectations - Management acknowledged weaker demand in digital due to national advertising pullback but remains optimistic for the second half of the year [14][15] Question: Confirmation of EBITDA guidance - Management confirmed that they are maintaining their EBITDA guidance but expect to be at the lower end [16] Question: Future debt buyback strategy - Management indicated that debt buybacks will depend on market conditions but emphasized the importance of managing leverage [17] Question: Update on potential M&A activities - Management stated that they are involved in a process but could not provide updates at this time [18] Question: Strategies to improve TV audience delivery - Management is exploring different measurement solutions and is engaged in negotiations regarding audience measurement [20][21] Question: Impact of political advertising - Management confirmed interest from both parties and noted that the company has significant exposure in key markets [36][37] Question: Revenue impact from TV One and CLEO joining Xfinity - Management clarified that the impact is positive but not significantly large as the service is still growing [42]