Exhibit 99.1
ENTRAVISION COMMUNICATIONS CORPORATION REPORTS
SECOND QUARTER 2011 RESULTS
SANTA MONICA,CALIFORNIA, August 3, 2011 – Entravision Communications Corporation (NYSE: EVC) today reported financial results for the three- and six-month periods ended June 30, 2011.
Historical results, which are attached, are in thousands of U.S. dollars (except share and per share data). This press release contains certain non-GAAP financial measures as defined by SEC Regulation G. The GAAP financial measure most directly comparable to each of these non-GAAP financial measures, and a table reconciling each of these non-GAAP financial measures to its most directly comparable GAAP financial measure, is included beginning on page 7. Unaudited financial highlights are as follows:
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | Three-Month Period
Ended June 30, | | | Six-Month Period
Ended June 30, | |
| | | 2011 | | | 2010 | | | % Change | | | 2011 | | | 2010 | | | % Change | |
Net revenue | | $ | 50,265 | | | $ | 53,431 | | | | (6 | )% | | $ | 94,309 | | | $ | 96,504 | | | | (2 | )% |
Operating expenses (1) | | | 31,773 | | | | 31,097 | | | | 2 | % | | | 61,837 | | | | 60,921 | | | | 2 | % |
Corporate expenses (2) | | | 3,772 | | | | 3,477 | | | | 8 | % | | | 7,517 | | | | 7,225 | | | | 4 | % |
Consolidated adjusted EBITDA (3) | | | 15,599 | | | | 18,966 | | | | (18 | )% | | | 26,007 | | | | 28,494 | | | | (9 | )% |
Free cash flow (4) | | $ | 4,967 | | | $ | 7,134 | | | | (30 | )% | | $ | 3,417 | | | $ | 4,534 | | | | (25 | )% |
Free cash flow per share, basic and diluted (4) | | $ | 0.06 | | | $ | 0.08 | | | | (25 | )% | | $ | 0.04 | | | $ | 0.05 | | | | (20 | )% |
Net income (loss) applicable to common stockholders | | $ | (352 | ) | | $ | 6,963 | | | | NM | | | $ | (4,784 | ) | | $ | 4,779 | | | | NM | |
Net income (loss) per share applicable to common stockholders, basic and diluted | | $ | 0.00 | | | $ | 0.08 | | | | (100 | )% | | $ | (0.06 | ) | | $ | 0.06 | | | | NM | |
Weighted average common shares outstanding, basic | | | 85,053,417 | | | | 84,494,665 | | | | | | | | 85,046,396 | | | | 84,462,613 | | | | | |
Weighted average common shares outstanding, diluted | | | 85,053,417 | | | | 85,373,021 | | | | | | | | 85,046,396 | | | | 85,278,162 | | | | | |
| (1) | Operating expenses include direct operating, selling, general and administrative expenses. Included in operating expenses are $0.2 million and $0.2 million of non-cash stock-based compensation for the three-month periods ended June 30, 2011 and 2010, respectively and $0.4 million and $0.5 million of non-cash stock-based compensation for the six-month periods ended June 30, 2011 and 2010, respectively. Operating expenses do not include corporate expenses, depreciation and amortization, impairment charge, gain (loss) on sale of assets and gain (loss) on debt extinguishment. |
| (2) | Corporate expenses include $0.3 million and $0.3 million of non-cash stock-based compensation for the three-month periods ended June 30, 2011 and 2010, respectively and $0.4 million and $0.5 million of non-cash stock-based compensation for the six-month periods ended June 30, 2011 and 2010, respectively. |
| (3) | Consolidated adjusted EBITDA means net income (loss) plus gain (loss) on sale of assets, depreciation and amortization, non-cash impairment charge, non-cash stock-based compensation included in operating and corporate expenses, other income (loss), net interest expense, income tax (expense) benefit, equity in net income (loss) of nonconsolidated affiliate, non-cash losses and syndication programming amortization less syndication programming payments. We use the term consolidated adjusted EBITDA because that measure is defined in our revolving credit facility and does not include gain (loss) on sale of assets, depreciation and amortization, non-cash impairment charge, non-cash stock-based compensation, other income (loss), net interest expense, income tax (expense) benefit, equity in net income (loss) of nonconsolidated affiliate, non-cash losses and syndication programming amortization and does include syndication programming payments. While many in the financial community and we consider consolidated adjusted EBITDA to be important, it should be considered in addition to, but not as a substitute for or superior to, other measures of liquidity and financial performance prepared in accordance with accounting principles generally accepted in the United States of America, such as cash flows from operating activities, operating income and net income. As consolidated adjusted EBITDA excludes non-cash gain (loss) on sale of assets, non-cash depreciation and amortization, non-cash impairment charge, non-cash stock-based compensation expense, other income (loss), net interest expense, income tax (expense) benefit, equity in net income (loss) of nonconsolidated affiliate, non-cash losses and syndication programming amortization and includes syndication programming payments, consolidated adjusted EBITDA has certain limitations because it excludes and includes several important non-cash financial line items. Therefore, we consider both non-GAAP and GAAP measures when evaluating our business. Consolidated adjusted EBITDA is also used to make executive compensation decisions. |
| (4) | Free cash flow is defined as consolidated adjusted EBITDA less cash paid for income taxes, net interest expense and capital expenditures. Net interest expense is defined as interest expense, less non-cash interest expense relating to amortization of debt finance costs, less non-cash interest expense relating to discount amortization on our $400 million aggregate principal amount of 8.750% senior secured first lien notes due 2017 (the “Notes”), less interest income and less the change in the fair value of our interest rate swaps. Free cash flow per share is defined as free cash flow divided by the basic or diluted weighted average common shares outstanding. |
Entravision Communications
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Commenting on the Company’s earnings results, Walter F. Ulloa, Chairman and Chief Executive Officer, said, “During the second quarter of 2011, we faced challenging comparisons to last year’s second quarter, when we benefited from World Cup, political and census advertising revenue. Nevertheless, our audience shares remain strong, and we believe we are well positioned to benefit as the U.S. Hispanic market continues to expand and advertisers increasingly recognize the importance of reaching our target audience. The release of the 2010 U.S. census data reconfirms the growth and importance of the U.S. Hispanic population and our position in some of the fastest-growing and most densely-populated Hispanic markets. We remain focused on improving our operating performance while continuing to carefully manage our costs.”
Financial Results
Three-Month Period Ended June 30, 2011 Compared to the Three-Month Period Ended June 30, 2010
(Unaudited)
| | | | | | | | | | | | |
| | | Three-Month Period
Ended June 30, | |
| | | 2011 | | | 2010 | | | % Change | |
Net revenue | | $ | 50,265 | | | $ | 53,431 | | | | (6 | )% |
Operating expenses (1) | | | 31,773 | | | | 31,097 | | | | 2 | % |
Corporate expenses (1) | | | 3,772 | | | | 3,477 | | | | 8 | % |
Depreciation and amortization | | | 4,425 | | | | 4,874 | | | | (9 | )% |
| | | | | | | | | | | | |
Operating income | | | 10,295 | | | | 13,983 | | | | (26 | )% |
Interest expense, net | | | (9,459 | ) | | | (5,179 | ) | | | 83 | % |
| | | | | | | | | | | | |
Income (loss) before income taxes | | | 836 | | | | 8,804 | | | | (91 | )% |
Income tax expense | | | (1,188 | ) | | | (1,928 | ) | | | (38 | )% |
| | | | | | | | | | | | |
Net income (loss) before equity in net income (loss) of nonconsolidated affiliates | | | (352 | ) | | | 6,876 | | | | NM | |
Equity in net income (loss) of nonconsolidated affiliates, net of tax | | | — | | | | 87 | | | | (100 | )% |
| | | | | | | | | | | | |
Net income (loss) | | $ | (352 | ) | | $ | 6,963 | | | | NM | |
| | | | | | | | | | | | |
| (1) | Operating expenses and corporate expenses are defined on page 1. |
Net revenue decreased to $50.3 million for the three-month period ended June 30, 2011 from $53.4 million for the three-month period ended June 30, 2010, a decrease of $3.1 million. Of the overall decrease, $1.7 million came from our television segment and was primarily attributable to advertising revenue from the World Cup in 2010, which is absent in 2011, partially offset by an increase in retransmission consent revenue. Additionally, $1.4 million of the overall decrease came from our radio segment and was primarily attributable to advertising revenue from the World Cup in 2010, which is absent in 2011.
Operating expenses increased to $31.8 million for the three-month period ended June 30, 2011 from $31.1 million for the three-month period ended June 30, 2010, an increase of $0.7 million. The increase was primarily attributable to an increase in salary expense as a result of the partial restoration of employee salaries in 2011 and expenses associated with Lotus/Entravision Reps LLC, partially offset by a decrease in national representation fees and other expenses associated with the decrease in net revenue.
Corporate expenses increased to $3.8 million for the three-month period ended June 30, 2011 from $3.5 million for the three-month period ended June 30, 2010, an increase of $0.3 million. The increase was attributable to an increase in professional fees.
Entravision Communications
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Six-Month Period Ended June 30, 2011 Compared to the Six-Month Period Ended June 30, 2010
(Unaudited)
| | | | | | | | | | | | |
| | | Six-Month Period | |
| | | Ended June 30, | |
| | | 2011 | | | 2010 | | | % Change | |
Net revenue | | $ | 94,309 | | | $ | 96,504 | | | | (2 | )% |
Operating expenses (1) | | | 61,837 | | | | 60,921 | | | | 2 | % |
Corporate expenses (1) | | | 7,517 | | | | 7,225 | | | | 4 | % |
Depreciation and amortization | | | 9,157 | | | | 9,597 | | | | (5 | )% |
| | | | | | | | | | | | |
Operating income | | | 15,798 | | | | 18,761 | | | | (16 | )% |
Interest expense, net | | | (18,900 | ) | | | (10,610 | ) | | | 78 | % |
Other income | | | 687 | | | | — | | | | NM | |
| | | | | | | | | | | | |
Income (loss) before income taxes | | | (2,415 | ) | | | 8,151 | | | | NM | |
Income tax expense | | | (2,369 | ) | | | (3,338 | ) | | | (29 | )% |
| | | | | | | | | | | | |
Net income (loss) before equity in net loss of nonconsolidated affiliates | | | (4,784 | ) | | | 4,813 | | | | NM | |
Equity in net loss of nonconsolidated affiliates, net of tax | | | — | | | | (34 | ) | | | (100 | )% |
| | | | | | | | | | | | |
Net income (loss) | | $ | (4,784 | ) | | $ | 4,779 | | | | NM | |
| | | | | | | | | | | | |
| (1) | Operating expenses and corporate expenses are defined on page 1. |
Net revenue decreased to $94.3 million for the six-month period ended June 30, 2011 from $96.5 million for the six-month period ended June 30, 2010, a decrease of $2.2 million. Of the overall decrease, $1.5 million came from our radio segment and was primarily attributable to advertising revenue from the World Cup and census in 2010, both of which are absent in 2011. Additionally, $0.7 million of the overall decrease came from our television segment and was primarily attributable to advertising revenue from the World Cup and political advertising revenue in 2010, both of which are not material in 2011, partially offset by an increase in retransmission consent revenue.
Operating expenses increased to $61.8 million for the six-month period ended June 30, 2011 from $60.9 million for the six-month period ended June 30, 2010, an increase of $0.9 million. The increase was primarily attributable to an increase in salary expense as a result of the partial restoration of employee salaries in 2011 and expenses associated with Lotus/Entravision Reps LLC, partially offset by a decrease in national representation fees and other expenses associated with the decrease in net revenue.
Corporate expenses increased to $7.5 million for the six-month period ended June 30, 2011 from $7.2 million for the six-month period ended June 30, 2010, an increase of $0.3 million. The increase was attributable to an increase in professional fees.
Entravision Communications
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Segment Results
The following represents selected unaudited segment information:
| | | | | | | | | | | | |
| | | Three-Month Period | |
| | | Ended June 30, | |
| | | 2011 | | | 2010 | | | % Change | |
Net Revenue | | | | | | | | | | | | |
Television | | $ | 33,118 | | | $ | 34,819 | | | | (5 | )% |
Radio | | | 17,147 | | | | 18,612 | | | | (8 | )% |
| | | | | | | | | | | | |
Total | | $ | 50,265 | | | $ | 53,431 | | | | (6 | )% |
Operating Expenses (1) | | | | | | | | | | | | |
Television | | $ | 18,656 | | | $ | 18,904 | | | | (1 | )% |
Radio | | | 13,117 | | | | 12,193 | | | | 8 | % |
| | | | | | | | | | | | |
Total | | $ | 31,773 | | | $ | 31,097 | | | | 2 | % |
Corporate Expenses (1) | | $ | 3,772 | | | $ | 3,477 | | | | 8 | % |
Consolidated adjusted EBITDA (1) | | $ | 15,599 | | | $ | 18,966 | | | | (18 | )% |
| (1) | Operating expenses, Corporate expenses, and Consolidated adjusted EBITDA are defined on page 1. |
Entravision Communications Corporation will hold a conference call to discuss its 2011 second quarter results on August 3, 2011 at 5 p.m. Eastern Time. To access the conference call, please dial 412-858-4600 ten minutes prior to the start time. The call will be webcast live and archived for replay on the investor relations portion of the Company’s Web site located atwww.entravision.com.
Entravision Communications Corporation is a diversified Spanish-language media company utilizing a combination of television, radio and digital operations to reach Hispanic consumers across the United States, as well as the border markets of Mexico. Entravision is the largest affiliate group of both the top-ranked Univision television network and Univision’s TeleFutura network, with television stations in 20 of the nation’s top 50 Hispanic markets. The company also operates one of the nation’s largest groups of primarily Spanish-language radio stations, consisting of 48 owned and operated radio stations. Additionally, Entravision has a variety of cross-platform digital content and sales offerings designed to capitalize on the company’s leadership position within the Hispanic broadcasting community. Entravision shares of Class A Common Stock are traded on The New York Stock Exchange under the symbol: EVC.
This press release contains certain forward-looking statements. These forward-looking statements, which are included in accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, may involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results and performance in future periods to be materially different from any future results or performance suggested by the forward-looking statements in this press release. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that actual results will not differ materially from these expectations, and the Company disclaims any duty to update any forward-looking statements made by the Company. From time to time, these risks, uncertainties and other factors are discussed in the Company’s filings with the Securities and Exchange Commission.
# # #
(Financial Table Follows)
| | |
| For more information, please contact: | | |
| |
| Christopher T. Young | | Mike Smargiassi/Brad Edwards |
| Chief Financial Officer | | Brainerd Communicators, Inc. |
| Entravision Communications Corporation | | 212-986-6667 |
| 310-447-3870 | | |
Entravision Communications
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Entravision Communications Corporation
Consolidated Statements of Operations
(In thousands, except share and per share data)
(Unaudited)
| | | | | | | | | | | | | | | | |
| | | Three-Month Period | | | Six-Month Period | |
| | | Ended June 30, | | | Ended June 30, | |
| | | 2011 | | | 2010 | | | 2011 | | | 2010 | |
Net revenue | | $ | 50,265 | | | $ | 53,431 | | | $ | 94,309 | | | $ | 96,504 | |
| | | | | | | | | | | | | | | | |
Expenses: | | | | | | | | | | | | | | | | |
Direct operating expenses (including related parties of $1,815, $3,151, $3,519 and $ 5,502) (including non-cash stock-based compensation of $53, $103, $104 and $ 208) | | | 22,487 | | | | 22,162 | | | | 43,308 | | | | 42,930 | |
Selling, general and administrative expenses (including non-cash stock-based compensation of $159, $147, $315 and $ 295) | | | 9,286 | | | | 8,935 | | | | 18,529 | | | | 17,991 | |
Corporate expenses (including non-cash stock-based compensation of $289, $286, $445 and $ 492) | | | 3,772 | | | | 3,477 | | | | 7,517 | | | | 7,225 | |
Depreciation and amortization (includes direct operating of $3,352, $3,385, $6,678 and $6,874; selling, general and administrative of $798, $903, $1,619 and $1,841; and corporate of $275, $586, $860 and $883) (including related parties of $627, $846, $1,520 and $1,426) | | | 4,425 | | | | 4,874 | | | | 9,157 | | | | 9,597 | |
| | | | | | | | | | | | | | | | |
| | | 39,970 | | | | 39,448 | | | | 78,511 | | | | 77,743 | |
| | | | | | | | | | | | | | | | |
Operating income (loss) | | | 10,295 | | | | 13,983 | | | | 15,798 | | | | 18,761 | |
Interest expense (including related parties of $15, $ 25, $30 and $ 54) | | | (9,459 | ) | | | (5,263 | ) | | | (18,902 | ) | | | (10,777 | ) |
Interest income | | | — | | | | 84 | | | | 2 | | | | 167 | |
Other income (loss) | | | — | | | | — | | | | 687 | | | | — | |
| | | | | | | | | | | | | | | | |
Income (loss) before income taxes | | | 836 | | | | 8,804 | | | | (2,415 | ) | | | 8,151 | |
Income tax (expense) benefit | | | (1,188 | ) | | | (1,928 | ) | | | (2,369 | ) | | | (3,338 | ) |
| | | | | | | | | | | | | | | | |
Income (loss) before equity in net income (loss) of nonconsolidated affiliate | | | (352 | ) | | | 6,876 | | | | (4,784 | ) | | | 4,813 | |
Equity in net income (loss) of nonconsolidated affiliate, net of tax | | | — | | | | 87 | | | | — | | | | (34 | ) |
| | | | | | | | | | | | | | | | |
Net income (loss) applicable to common stockholders | | $ | (352 | ) | | $ | 6,963 | | | $ | (4,784 | ) | | $ | 4,779 | |
| | | | | | | | | | | | | | | | |
Basic and diluted earnings per share: | | | | | | | | | | | | | | | | |
Net income (loss) per share applicable to common stockholders, basic and diluted | | $ | 0.00 | | | $ | 0.08 | | | $ | (0.06 | ) | | $ | 0.06 | |
| | | | | | | | | | | | | | | | |
Weighted average common shares outstanding, basic | | | 85,053,417 | | | | 84,494,665 | | | | 85,046,396 | | | | 84,462,613 | |
| | | | | | | | | | | | | | | | |
Weighted average common shares outstanding, diluted | | | 85,053,417 | | | | 85,373,021 | | | | 85,046,396 | | | | 85,278,162 | |
| | | | | | | | | | | | | | | | |
Entravision Communications
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Entravision Communications Corporation
Consolidated Statements of Cash Flows
(Unaudited; in thousands)
| | | | | | | | | | | | | | | | |
| | | Three-Month Period | | | Six-Month Period | |
| | | Ended June 30, | | | Ended June 30, | |
| | | 2011 | | | 2010 | | | 2011 | | | 2010 | |
Cash flows from operating activities: | | | | | | | | | | | | | | | | |
Net income (loss) | | $ | (352 | ) | | $ | 6,963 | | | $ | (4,784 | ) | | $ | 4,779 | |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | 4,425 | | | | 4,874 | | | | 9,157 | | | | 9,597 | |
Deferred income taxes | | | 979 | | | | 1,414 | | | | 1,617 | | | | 2,627 | |
Amortization of debt issue costs | | | 547 | | | | 104 | | | | 1,086 | | | | 208 | |
Amortization of syndication contracts | | | 853 | | | | 278 | | | | 1,143 | | | | 550 | |
Payments on syndication contracts | | | (475 | ) | | | (705 | ) | | | (955 | ) | | | (1,409 | ) |
Equity in net income (loss) of nonconsolidated affiliate | | | — | | | | (87 | ) | | | — | | | | 34 | |
Non-cash stock-based compensation | | | 501 | | | | 536 | | | | 864 | | | | 995 | |
Other income (loss) | | | — | | | | — | | | | (687 | ) | | | — | |
Change in fair value of interest rate swap agreements | | | — | | | | (4,123 | ) | | | — | | | | (8,053 | ) |
Changes in assets and liabilities, net of effect of acquisitions and dispositions: | | | | | | | | | | | | | | | | |
(Increase) decrease in restricted cash | | | 809 | | | | — | | | | 809 | | | | — | |
(Increase) decrease in accounts receivable | | | (5,202 | ) | | | (8,665 | ) | | | 1,605 | | | | (3,625 | ) |
(Increase) decrease in prepaid expenses and other assets | | | 645 | | | | 140 | | | | 47 | | | | 48 | |
Increase (decrease) in accounts payable, accrued expenses and other liabilities | | | 9,844 | | | | 3,339 | | | | (783 | ) | | | 3,451 | |
| | | | | | | | | | | | | | | | |
Net cash provided by (used in) operating activities | | | 12,574 | | | | 4,068 | | | | 9,119 | | | | 9,202 | |
| | | | | | | | | | | | | | | | |
Cash flows from investing activities: | | | | | | | | | | | | | | | | |
Purchases of property and equipment and intangibles | | | (2,189 | ) | | | (3,371 | ) | | | (4,702 | ) | | | (6,045 | ) |
Purchase of a business | | | (203 | ) | | | — | | | | (551 | ) | | | — | |
| | | | | | | | | | | | | | | | |
Net cash provided by (used in) investing activities | | | (2,392 | ) | | | (3,371 | ) | | | (5,253 | ) | | | (6,045 | ) |
| | | | | | | | | | | | | | | | |
Cash flows from financing activities: | | | | | | | | | | | | | | | | |
Proceeds from issuance of common stock | | | 15 | | | | 69 | | | | 42 | | | | 219 | |
Payments on long-term debt | | | (1,000 | ) | | | (1,000 | ) | | | (1,000 | ) | | | (4,458 | ) |
Payments of deferred debt and offering costs | | | — | | | | (501 | ) | | | (29 | ) | | | (863 | ) |
| | | | | | | | | | | | | | | | |
Net cash provided by (used in) financing activities | | | (985 | ) | | | (1,432 | ) | | | (987 | ) | | | (5,102 | ) |
| | | | | | | | | | | | | | | | |
Net increase (decrease) in cash and cash equivalents | | | 9,197 | | | | (735 | ) | | | 2,879 | | | | (1,945 | ) |
Cash and cash equivalents: | | | | | | | | | | | | | | | | |
Beginning | | | 66,072 | | | | 26,456 | | | | 72,390 | | | | 27,666 | |
| | | | | | | | | | | | | | | | |
Ending | | $ | 75,269 | | | $ | 25,721 | | | $ | 75,269 | | | $ | 25,721 | |
| | | | | | | | | | | | | | | | |
Entravision Communications
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Entravision Communications Corporation
Reconciliation of Consolidated Adjusted EBITDA to Cash Flows From Operating Activities
(Unaudited; in thousands)
The most directly comparable GAAP financial measure is operating cash flow. A reconciliation of this non-GAAP measure to cash flows from operating activities for each of the periods presented is as follows:
| | | | | | | | | | | | | | | | |
| | | Three-Month Period | | | Six-Month Period | |
| | | Ended June 30, | | | Ended June 30, | |
| | | 2011 | | | 2010 | | | 2011 | | | 2010 | |
Consolidated adjusted EBITDA (1) | | $ | 15,599 | | | $ | 18,966 | | | $ | 26,007 | | | $ | 28,494 | |
Interest expense | | | (9,459 | ) | | | (5,263 | ) | | | (18,902 | ) | | | (10,777 | ) |
Interest income | | | — | | | | 84 | | | | 2 | | | | 167 | |
Income tax (expense) benefit | | | (1,188 | ) | | | (1,928 | ) | | | (2,369 | ) | | | (3,338 | ) |
Amortization of syndication contracts | | | (853 | ) | | | (278 | ) | | | (1,143 | ) | | | (550 | ) |
Payments on syndication contracts | | | 475 | | | | 705 | | | | 955 | | | | 1,409 | |
Non-cash stock-based compensation included in direct operating expenses | | | (53 | ) | | | (103 | ) | | | (104 | ) | | | (208 | ) |
Non-cash stock-based compensation included in selling, general and administrative expenses | | | (159 | ) | | | (147 | ) | | | (315 | ) | | | (295 | ) |
Non-cash stock-based compensation included in corporate expenses | | | (289 | ) | | | (286 | ) | | | (445 | ) | | | (492 | ) |
Depreciation and amortization | | | (4,425 | ) | | | (4,874 | ) | | | (9,157 | ) | | | (9,597 | ) |
Other income (loss) | | | — | | | | — | | | | 687 | | | | — | |
Equity in net income (loss) of nonconsolidated affiliates | | | — | | | | 87 | | | | — | | | | (34 | ) |
| | | | | | | | | | | | | | | | |
Net income (loss) | | | (352 | ) | | | 6,963 | | | | (4,784 | ) | | | 4,779 | |
Depreciation and amortization | | | 4,425 | | | | 4,874 | | | | 9,157 | | | | 9,597 | |
Deferred income taxes | | | 979 | | | | 1,414 | | | | 1,617 | | | | 2,627 | |
Amortization of debt issue costs | | | 547 | | | | 104 | | | | 1,086 | | | | 208 | |
Amortization of syndication contracts | | | 853 | | | | 278 | | | | 1,143 | | | | 550 | |
Payments on syndication contracts | | | (475 | ) | | | (705 | ) | | | (955 | ) | | | (1,409 | ) |
Equity in net income (loss) of nonconsolidated affiliate | | | — | | | | (87 | ) | | | — | | | | 34 | |
Non-cash stock-based compensation | | | 501 | | | | 536 | | | | 864 | | | | 995 | |
Other (income) loss | | | — | | | | — | | | | (687 | ) | | | — | |
Change in fair value of interest rate swap agreements | | | — | | | | (4,123 | ) | | | — | | | | (8,053 | ) |
Changes in assets and liabilities, net of effect of acquisitions and dispositions: | | | | | | | | | | | | | | | | |
(Increase) decrease in restricted cash | | | 809 | | | | — | | | | 809 | | | | — | |
(Increase) decrease in accounts receivable | | | (5,202 | ) | | | (8,665 | ) | | | 1,605 | | | | (3,625 | ) |
(Increase) decrease in prepaid expenses and other assets | | | 645 | | | | 140 | | | | 47 | | | | 48 | |
Increase (decrease) in accounts payable, accrued expenses and other liabilities | | | 9,844 | | | | 3,339 | | | | (783 | ) | | | 3,451 | |
| | | | | | | | | | | | | | | | |
Cash flows from operating activities | | $ | 12,574 | | | $ | 4,068 | | | $ | 9,119 | | | $ | 9,202 | |
| | | | | | | | | | | | | | | | |
| (1) | Consolidated adjusted EBITDA is defined on page 1. |
Entravision Communications
Page 8of 8
Entravision Communications Corporation
Reconciliation of Free Cash Flow to Net Income (Loss)
(Unaudited; in thousands)
The most directly comparable GAAP financial measure is net income (loss). A reconciliation of this non-GAAP measure to net income (loss) for each of the periods presented is as follows:
| | | | | | | | | | | | | | | | |
| | | Three-Month Period | | | Six-Month Period | |
| | | Ended June 30, | | | Ended June 30, | |
| | | 2011 | | | 2010 | | | 2011 | | | 2010 | |
Consolidated adjusted EBITDA (1) | | $ | 15,599 | | | $ | 18,966 | | | $ | 26,007 | | | $ | 28,494 | |
Net interest expense (1) | | | 8,912 | | | | 9,197 | | | | 17,814 | | | | 18,454 | |
Cash paid for income taxes | | | 209 | | | | 514 | | | | 752 | | | | 711 | |
Capital expenditures (2) | | | 1,511 | | | | 2,121 | | | | 4,024 | | | | 4,795 | |
| | | | | | | | | | | | | | | | |
Free cash flow (1) | | | 4,967 | | | | 7,134 | | | | 3,417 | | | | 4,534 | |
Capital expenditures (2) | | | 1,511 | | | | 2,121 | | | | 4,024 | | | | 4,795 | |
Non-cash interest expense relating to amortization of debt finance costs and interest rate swap agreements | | | (547 | ) | | | 4,018 | | | | (1,086 | ) | | | 7,844 | |
Non-cash income tax expense | | | (979 | ) | | | (1,414 | ) | | | (1,617 | ) | | | (2,627 | ) |
Amortization of syndication contracts | | | (853 | ) | | | (278 | ) | | | (1,143 | ) | | | (550 | ) |
Payments on syndication contracts | | | 475 | | | | 705 | | | | 955 | | | | 1,409 | |
Non-cash stock-based compensation included in direct operating expenses | | | (53 | ) | | | (103 | ) | | | (104 | ) | | | (208 | ) |
Non-cash stock-based compensation included in selling, general and administrative expenses | | | (159 | ) | | | (147 | ) | | | (315 | ) | | | (295 | ) |
Non-cash stock-based compensation included in corporate expenses | | | (289 | ) | | | (286 | ) | | | (445 | ) | | | (492 | ) |
Depreciation and amortization | | | (4,425 | ) | | | (4,874 | ) | | | (9,157 | ) | | | (9,597 | ) |
Other income (loss) | | | — | | | | — | | | | 687 | | | | — | |
Equity in net income (loss) of nonconsolidated affiliates | | | — | | | | 87 | | | | — | | | | (34 | ) |
| | | | | | | | | | | | | | | | |
Net income (loss) | | $ | (352 | ) | | $ | 6,963 | | | $ | (4,784 | ) | | $ | 4,779 | |
| | | | | | | | | | | | | | | | |
| (1) | Consolidated adjusted EBITDA, net interest expense and free cash flow are defined on page 1. |
| (2) | Capital expenditures is not part of the consolidated statement of operations. |
