Saga munications(US:SGA)2025-11-06 17:00Financial Data and Key Metrics Changes - For Q3 2025, the company reported an operating income of $6,000 without the music licensing settlement, compared to $1,600,000 for the same period last year [4] - Station operating income for the quarter was $3,500,000, which would have been $5,600,000 without the settlement, down from $6,000,000 last year [4] - Net revenue for the nine-month period ended September 30, 2025, decreased by $3,100,000 or 3.7% to $80,600,000 compared to $83,700,000 last year [5] - Total interactive revenue increased by 32.6% for the quarter and 17.1% for the nine-month period, with a profit margin of 54% [7] Business Line Data and Key Metrics Changes - Gross broadcast revenue, including nontraditional revenue (NTR), decreased by $1,800,000 or 6.8%, while gross interactive revenue increased by $1,100,000 or 32.6% [4] - Political revenue for the quarter was $73,000, down from $677,000 last year [4] - The increase in interactive revenue offset almost the entire decrease in broadcast revenue when adjusted for political [5][26] Market Data and Key Metrics Changes - The company is currently pacing down approximately 11% for the fourth quarter, including political revenue, and 4.7% when excluding political [7] - Local pacing remains consistent, while digital pacing is up 32% for the quarter [31] Company Strategy and Development Direction - The company is focused on a blended digital strategy aiming to double gross revenue, primarily through digital channels, within 18 to 24 months [14] - Strategic investments in R&D and resources are being made to support this digital transformation [14] - The company plans to utilize proceeds from the sale of telecommunications towers for stock buybacks and to maintain a robust quarterly dividend strategy [9][15] Management's Comments on Operating Environment and Future Outlook - Management noted that the local advertising market is overdue for disruption, with businesses increasingly investing in digital advertising [22] - The company believes that its digital transformation is gaining momentum, with measurable returns already being observed [24][26] - Management acknowledged the challenges of the digital transformation but expressed confidence in the team's commitment and capabilities [27] Other Important Information - The company paid a quarterly dividend of $0.25 per share, totaling approximately $1,600,000 [8] - As of November 3, 2025, the company had $26,300,000 in cash and short-term investments [10] - The company expects capital expenditures between $3,250,000 and $3,750,000 for 2025 [11] Q&A Session Summary Question: Can you provide insights on market tone and pacing into the upcoming quarter? - Management indicated that national advertising is weak, impacting forward pacing, while local pacing is consistent and digital pacing is up 32% [30][31] Question: Why is there no concrete plan for a buyback post-tower sale? - Management explained that complexities related to the tower sale and real estate transfer issues delayed clarity on final sale proceeds, which are necessary for buyback planning [35][36]