Exhibit 99.1
Saga Communications, Inc.
Reports 1st Quarter 2010 Results
Reports 1st Quarter 2010 Results
Free Cash Flow Increased 140%
Contact:
Samuel D. Bush
313/886-7070
Samuel D. Bush
313/886-7070
Grosse Pointe Farms, MI — May 11, 2010 — Saga Communications, Inc. (NYSE Amex-SGA) today reported net operating revenue for the quarter ended March 31, 2010 increased 7.1% to $28.0 million. Free cash flow increased 140% to $2.3 million for the quarter compared to $939 thousand for the same period in 2009. Station operating expense decreased 5.8% compared to the same period last year to $22.6 million (station operating expense includes depreciation and amortization attributable to the stations). The Company’s net income for the period was $3.3 million ($.78 per fully diluted share) compared to a net loss of $362 thousand (-$0.09 per fully diluted share) for the same period last year.
The Company continues to maintain a solid balance sheet with $16.4 million in cash balances as of March 31, 2010. As of March 31, 2010, the Company’s outstanding bank debt was $116.1 million. The trailing 12 month leverage ratio calculated as a multiple of EBITDA was 3.7 times. Netting cash against outstanding debt, the ratio would be 3.2 times.
Capital expenditures in the first quarter of 2010 were $845 thousand compared to $1.1 million for the same period last year. For the 2009 fiscal year total capital expenditures were $4.0 million. The Company currently expects to spend approximately $4.5 — $5.0 million for capital expenditures during 2010.
Saga Communications utilizes certain financial measures that are not calculated in accordance with generally accepted accounting principles (GAAP) to assess its financial performance. Such non-GAAP measures include free cash flow, trailing 12 month consolidated EBITDA, and leverage ratio. These non-GAAP measures are generally recognized by the broadcasting industry as measures of performance and are used by Saga to assess its financial performance including but not limited to evaluating individual
station and market-level performance, evaluating overall operations, as a primary measure for incentive based compensation of executives and other members of management and as a measure of financial position. Saga’s management believes these non-GAAP measures are used by analysts who report on the industry and by investors to provide meaningful comparisons between broadcasting groups, as well as an indicator of their market value. These measures are not measures of liquidity or of performance in accordance with GAAP, and should be viewed as a supplement to and not as a substitute for the results of operations presented on a GAAP basis including net operating revenue, operating income, and net income. Reconciliations for all of the non-GAAP financial measures to the most directly comparable GAAP measure are attached in the Selected Supplemental Financial Data table.
Saga Communications, Inc. is a broadcasting company whose business is devoted to acquiring, developing and operating broadcast properties. The Company owns or operates broadcast properties in 26 markets, including 61 FM and 30 AM radio stations, 3 state radio networks, 2 farm radio networks, 5 television stations and 4 low-power television stations. For additional information, contact us at (313) 886-7070 or visit our website atwww.sagacommunications.com.
Saga’s 1st Quarter 2010 conference call will be on Tuesday, May 11, 2010 at 2:00 p.m. EDT. The dial-in number for domestic calls is (612) 288-0329. The call can be replayed for 7 days by calling domestically (800) 475-6701 and referring to access code 153594.
The Company requests that all parties that have a question that they would like to submit to the Company to please email the inquiry by 1:00 p.m. EDT on May 11, 2010 toSagaIR@sagacom.com. The Company will discuss, during the limited period of the conference call, those inquiries it deems of general relevance and interest. Only inquiries made in compliance with the foregoing will be discussed during the call.
This press release contains certain forward-looking statements that are based upon current expectations and involve certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Words such as “believes,” “expects,” “anticipates,” “guidance” and similar expressions are intended to identify forward-looking statements. Key risks, including risks associated with Saga’s ability to effectively integrate the stations it acquires and the impact of federal regulation on Saga’s business, are described in the reports Saga Communications, Inc. periodically files with the U.S. Securities and Exchange Commission, including Item 1A of our Annual Report on Form 10-K. Readers should note that these statements may be impacted by several factors, including national and local economic changes and changes in the radio and television broadcast industry in general, as well as Saga’s actual performance. Results may vary from those stated herein and Saga undertakes no obligation to update the information contained here.
Saga Communications, Inc.
Selected Consolidated Financial Data
For The Three Months Ended
March 31, 2010 and 2009
(amounts in 000’s except per share data)
(Unaudited)
Selected Consolidated Financial Data
For The Three Months Ended
March 31, 2010 and 2009
(amounts in 000’s except per share data)
(Unaudited)
| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2010 | 2009 | |||||||
Operating Results | ||||||||
| Net operating revenue | $ | 27,987 | $ | 26,124 | ||||
| Station operating expense | 22,560 | 23,940 | ||||||
| Corporate general and administrative | 1,882 | 2,067 | ||||||
| Operating income | 3,545 | 117 | ||||||
| Interest expense | 1,519 | 773 | ||||||
| Other income, net | (3,596 | ) | (4 | ) | ||||
| Income (loss) before income tax | 5,622 | (652 | ) | |||||
| Income tax expense (benefit) | 2,305 | (290 | ) | |||||
| Net income (loss) | $ | 3,317 | $ | (362 | ) | |||
| Earnings (loss) per share | ||||||||
| Basic | $ | 0.78 | $ | (0.09 | ) | |||
| Diluted | $ | 0.78 | $ | (0.09 | ) | |||
| Weighted average common shares | 4,228 | 4,161 | ||||||
| Weighted average common shares and common shares equivalents | 4,229 | 4,161 | ||||||
Free Cash Flow | ||||||||
| Net income (loss) | $ | 3,317 | $ | (362 | ) | |||
| Plus: Depreciation and amortization: | ||||||||
| Station | 1,845 | 2,197 | ||||||
| Corporate | 52 | 61 | ||||||
| Deferred tax provision (benefit) | 1,180 | (215 | ) | |||||
| Non-cash compensation | 298 | 327 | ||||||
| Other income, net | (3,596 | ) | (4 | ) | ||||
| Less: Capital expenditures | (845 | ) | (1,065 | ) | ||||
| Free cash flow | $ | 2,251 | $ | 939 | ||||
Balance Sheet Data | ||||||||
| Working capital | $ | 9,203 | $ | 16,304 | ||||
| Net fixed assets | $ | 68,152 | $ | 72,210 | ||||
| Net intangible assets and other assets | $ | 97,432 | $ | 113,915 | ||||
| Total assets | $ | 202,823 | $ | 216,847 | ||||
| Long term debt (including current portion of $15,200 and $2,350, respectively) | $ | 116,078 | $ | 133,411 | ||||
| Stockholders’ equity | $ | 67,630 | $ | 65,233 | ||||
Saga Communications, Inc.
Selected Supplemental Financial Data
March 31, 2010
(amounts in 000’s except ratios)
(Unaudited)
Selected Supplemental Financial Data
March 31, 2010
(amounts in 000’s except ratios)
(Unaudited)
| Corporate | ||||||||||||||||
| Radio | Television | and Other | Consolidated | |||||||||||||
Three Months Ended March 31, 2010: | ||||||||||||||||
| Net operating revenue | $ | 24,144 | $ | 3,843 | $ | — | $ | 27,987 | ||||||||
| Station operating expense | 19,223 | 3,337 | — | 22,560 | ||||||||||||
| Corporate G&A | — | — | 1,882 | 1,882 | ||||||||||||
| Operating income | $ | 4,921 | $ | 506 | $ | (1,882 | ) | $ | 3,545 | |||||||
| Depreciation and amortization | $ | 1,421 | $ | 424 | $ | 52 | $ | 1,897 | ||||||||
| Corporate | ||||||||||||||||
| Radio | Television | and Other | Consolidated | |||||||||||||
Three Months Ended March 31, 2009: | ||||||||||||||||
| Net operating revenue | $ | 22,697 | $ | 3,427 | $ | — | $ | 26,124 | ||||||||
| Station operating expense | 20,317 | 3,623 | — | 23,940 | ||||||||||||
| Corporate G&A | — | — | 2,067 | 2,067 | ||||||||||||
| Operating income | $ | 2,380 | $ | (196 | ) | $ | (2,067 | ) | $ | 117 | ||||||
| Depreciation and amortization | $ | 1,531 | $ | 666 | $ | 61 | $ | 2,258 | ||||||||
| Less: | Plus: | Trailing | ||||||||||||||
| 12 Mos Ended | 3 Mos Ended | 3 Mos Ended | 12 Mos Ended | |||||||||||||
| December 31, | March 31, | March 31, | March 31, | |||||||||||||
| 2009 | 2009 | 2010 | 2010 | |||||||||||||
Trailing 12 Month Consolidated EBITDA | ||||||||||||||||
| Net income (loss) | $ | (2,581 | ) | $ | (362 | ) | $ | 3,317 | $ | 1,098 | ||||||
| Less: Gain (loss) on sale of assets | (210 | ) | 4 | 35 | (179 | ) | ||||||||||
| Gain on exchange of assets | 495 | — | — | 495 | ||||||||||||
| Impairment of intangible assets | (17,286 | ) | — | — | (17,286 | ) | ||||||||||
| Gain on license downgrade | — | — | 3,561 | 3,561 | ||||||||||||
| Other | 196 | (4 | ) | (12 | ) | 188 | ||||||||||
| Total exclusions | (16,805 | ) | — | 3,584 | (13,221 | ) | ||||||||||
| Consolidated Adjusted Net Income (Loss) | 14,224 | (362 | ) | (267 | ) | 14,319 | ||||||||||
| Plus: Interest expense | 4,948 | 773 | 1,519 | 5,694 | ||||||||||||
| Income tax expense (benefit) | (1,161 | ) | (290 | ) | 2,305 | 1,434 | ||||||||||
| Depreciation & amortization expense | 8,629 | 2,258 | 1,897 | 8,268 | ||||||||||||
| Amortization of television syndicated programming contracts | 706 | 179 | 180 | 707 | ||||||||||||
| Non-cash stock based compensation expense | 1,366 | 327 | 298 | 1,337 | ||||||||||||
| Less: Cash television programming payments | (725 | ) | (182 | ) | (181 | ) | (724 | ) | ||||||||
| Trailing twelve month consolidated EBITDA | $ | 27,987 | $ | 2,703 | $ | 5,751 | $ | 31,035 | ||||||||
| Total long-term debt, including current maturities | $ | 116,078 | ||||||||||||||
| Divided by trailing twelve month consolidated EBITDA | 31,035 | |||||||||||||||
| Leverage ratio | 3.7 | |||||||||||||||
| Total long-term debt, including current maturities | $ | 116,078 | ||||||||||||||
| Less: Cash and cash equivalents as of March 31, 2010 | (16,426 | ) | ||||||||||||||
| Long-term debt, including current maturities less cash and cash equivalents as of March 31, 2010 | 99,652 | |||||||||||||||
| Divided by trailing twelve month consolidated EBITDA | 31,035 | |||||||||||||||
| Adjusted leverage ratio | 3.2 | |||||||||||||||