Urban One(US:UONE)2020-11-12 21:21Financial Data and Key Metrics Changes - In Q3 2020, net revenue decreased by 17.2% year-over-year to approximately $91.9 million, but increased by 20.9% from Q2 2020 [12] - EBITDA guidance for 2020 is projected to be between $125 million and $130 million, compared to $133 million in the previous year [10][11] - The net loss for Q3 2020 was approximately $12.8 million or $0.29 per share, compared to a net income of approximately $5.4 million or $0.12 per share in Q3 2019 [30] Business Line Data and Key Metrics Changes - Radio segment net revenue was down 31.9% year-over-year in Q3 but up 54.3% from Q2, including approximately $2.4 million from political advertising [12][13] - Reach Media's net revenue decreased by 29%, but adjusted EBITDA increased by approximately $1.3 million or 68% year-over-year [16] - Digital segment net revenues increased by 3.4%, driven by strength in direct advertising sales, with adjusted EBITDA growth of approximately $864,000 or 121% year-over-year [17] Market Data and Key Metrics Changes - National advertising sales for Q3 were down 21.5% year-over-year, while local ad sales were down 36% [13] - Political advertising revenue for the fourth quarter is expected to exceed $20 million, significantly higher than previous records [15] - Cable television segment revenue decreased by 2.7%, with advertising revenue down by 1.8% [17] Company Strategy and Development Direction - The company is focusing on consolidating its radio assets to create economies of scale and enhance advertiser clout [37] - A recent radio asset swap with Entercom aims to expand market presence and improve revenue potential in Charlotte [39] - The company is committed to deleveraging and maintaining liquidity throughout the pandemic, with a focus on cost control and operational efficiency [35][43] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the pandemic, citing strong performance in political advertising and improvements in core business segments [34][35] - The radio business is expected to improve in 2021, although it may not return to pre-COVID levels [47] - The company anticipates that the casino business will continue to perform well, particularly in regional markets [101] Other Important Information - The company executed a stock-based tax repurchase of 3,195 shares of Class D common stock for $6,000 [31] - A non-cash impairment expense of $29 million was recorded due to COVID-19 impacts on radio market revenue [27] - Interest expense decreased by 9.9% to approximately $18.2 million for Q3 2020 [28] Q&A Session Summary Question: Can you provide the multiple on the radio station sale in St. Louis? - The multiple was 16.8 times [52] Question: What are the fees on the MGM National Harbor put interest? - The fees are 6.67% [53] Question: How is the company planning to address near-term maturities in its capital structure? - The company plans to re-rack the entire capital structure in 2021, ideally after the COVID quarters [55][60] Question: What is the normalized EBITDA expected for 2021? - Management indicated that 2021 is not expected to return to pre-COVID levels, and they will approach budgeting cautiously [69][72] Question: Is there an opportunity for consolidation in cable TV? - While the company is focused on radio consolidation, they are also leveraging the strength of their cable assets [73][75]