Townsquare Media(US:TSQ)2024-05-11 22:42Financial Data and Key Metrics Changes - In Q1 2024, net revenue declined 3.4% year-over-year to $99.6 million, within guidance range [17] - Adjusted EBITDA for Q1 2024 decreased 9.9% year-over-year to $17.5 million, also within guidance range [17] - Net income improved from a loss of $1.9 million in Q1 2023 to a profit of $1.6 million in Q1 2024, equating to $0.06 per diluted share [30] Business Line Data and Key Metrics Changes - Broadcast advertising net revenue decreased just 1% in Q1 2024, showing sequential improvement from Q4 [17][21] - Townsquare Interactive's net revenue declined 15% year-over-year but showed less than 5% decline quarter-over-quarter, returning to month-over-month revenue growth in March [12][18] - Digital advertising net revenue increased 1.3% year-over-year in Q1 2024, driven by programmatic advertising growth [19] Market Data and Key Metrics Changes - Political revenue in Q1 2024 was $1.1 million, 20% below Q1 2020 levels, but full-year expectations remain optimistic at $14 million to $16 million [14][17] - National digital advertising revenue declined 29% year-over-year in Q1 2024, with expectations of over 30% decline in Q2 [11][19] Company Strategy and Development Direction - The company is transitioning to a digital-first local media model, with 53% of total net revenue coming from digital solutions [8] - Continued investment in digital growth is emphasized, particularly in programmatic advertising, which is expected to be a major growth driver [10][11] - The company aims to leverage its strong cash flow to support shareholder value through dividends and share repurchases while maintaining a focus on deleveraging [22][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to growth in Townsquare Interactive, with expectations for quarter-over-quarter revenue growth in Q2 2024 [27][37] - The tone of the advertising market is improving, with expectations for national advertising to stabilize and potentially improve in the coming quarters [44] - The company remains focused on maintaining its competitive advantage in markets outside the top 50 U.S. cities, emphasizing local content and digital capabilities [15][67] Other Important Information - The company repurchased approximately $4 million worth of shares in Q1 2024 and has a strong cash position of $57 million at the end of the quarter [23][31] - The board approved a quarterly dividend of $0.195 per share, reflecting a 5% increase from the previous quarter [32] Q&A Session Summary Question: What is the trajectory of subscriber growth in Townsquare Interactive? - Management noted that subscriber growth is occurring across multiple locations, with significant improvements in customer service and a new business management platform contributing to this growth [27][28] Question: When can the business expect to see quarterly revenue growth? - Management anticipates potential quarter-over-quarter revenue growth in Q2 2024, with year-over-year growth expected in Q1 2025 due to previous subscriber losses [37][41] Question: How is the broadcast business performing in the current environment? - The broadcast business is viewed as a cash cow, with management proud of the market share gains despite a slow decline in overall revenue [39][44] Question: What are the capital allocation priorities moving forward? - The company will continue to focus on deleveraging, supporting dividends, and opportunistically buying back stock while investing in local businesses [45][48]