[SAGA COMMUNICATIONS, INC. LOGO]
Saga Communications, Inc.
Reports 1st Quarter 2004 Results
CONTACT:
Samuel D. Bush
313/886-7070
Grosse Pointe Farms, MI -- May 4, 2004 -- Saga Communications, Inc. (NYSE-SGA)
today reported net income of $2.5 million ($.12 per fully diluted share) for the
quarter ended March 31, 2004 compared to $1.6 million ($.08 per fully diluted
share) for 2003. For the quarter ended March 31, 2004, net operating revenue
increased 11.6% over the comparable period in 2003 to approximately $29.2
million. Operating income increased 23.0% to approximately $5.3 million. Station
operating income (net operating revenue less station operating expense)
increased 18.1% to approximately $8.7 million for the quarter. On a same station
basis for the quarter, net operating revenue increased 8.0% to approximately
$28.2 million, operating income increased 21.0% to $5.2 million and station
operating income (net operating revenue less station operating expense)
increased 16.1% to approximately $8.5 million.
Capital expenditures in the first quarter of 2004 were approximately $2.3
million with approximately $.9 million being spent as a result of acquisitions.
For the year ending 2004 total capital expenditures are expected to approximate
$8.5 to $9.0 million with approximately $4.0 -- $4.5 million being spent as a
result of acquisitions.
The attached Selected Supplemental Financial Data table discloses "as reported,"
"same station" and "pro forma" information by segment. The "as reported" amounts
reflect our historical financial results and include the results of operations
for stations that we did not own for the entire comparable period. The "same
station" amounts reflect only the results of operations for stations that we
owned for the entire comparable period. The "pro forma" amounts assume the 2004
and 2003 acquisitions and dispositions occurred as of January 1, 2003.
Saga expects net revenue to be between $35.0 and $35.5 million and station
operating expenses to be between $22.4 and $22.7 million on a pro forma basis
for the second quarter of 2004. The guidance being provided is based on the
economic and market conditions as of May 4, 2004. The Company can give no
assurances as to whether these conditions will continue, or if they change, how
such changes may affect the Company's current expectations. While Saga may from
time to time issue updated guidance, it assumes no obligation to do so.
Saga Communications utilizes certain financial measures that are not calculated
in accordance with generally accepted accounting principles (GAAP) to access its
financial performance. Such non-GAAP measures include station operating income,
same station financial information, pro forma station operating income and free
cash flow. 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 and as a primary measure
for incentive based compensation of executives and other members of management.
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 Financial Data Non-GAAP Disclosures tables.
Additionally, the Company announced that it has entered into an agreement to
acquire the assets of WXLS-FM, which will be its fourth radio station in the
environs of Champaign, IL. The assets are to be purchased for approximately
$3.25 million with the closing expected to occur, subject to the approval of the
Federal Communications Commission, during the 3rd quarter 2004.
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 24 markets, including 52 FM and 27 AM radio
stations, 3 state radio networks, 2 farm radio networks, 5 television stations
and 3 low power television stations. Additionally, Saga has entered into
agreements to acquire an AM and FM serving the Asheville, NC radio market. For
additional information contact us at 313/886-7070 or visit our website at
www.sagacommunications.com.
Saga's first quarter results conference call will be on Tuesday, May 4 at
10:00AM. The dial in number for domestic calls is 888/273-9885. For
international callers the number is 612/332-0820. The call can be replayed for 7
days by calling domestically 800/475-6701 or internationally 320/365-3844 and
referring to access code 728081. Thereafter, a transcript of the call will be
available on our website.
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. 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 MONTH PERIODS
ENDED MARCH 31, 2004 AND 2003
(AMOUNTS IN 000'S EXCEPT PER SHARE DATA)
(Unaudited)
THREE MONTHS ENDED
MARCH 31,
----------------------------
2004 2003
--------- ---------
OPERATING RESULTS
Net operating revenue $ 29,173 $ 26,141
Station operating expense (excluding depreciation,
amortization, corporate general and administrative) 20,518 18,813
--------- ---------
Station operating income (*) 8,655 7,328
Corporate general and administrative 1,683 1,245
Depreciation 1,674 1,719
Amortization 42 90
--------- ---------
Operating income 5,256 4,274
Interest expense 1,095 1,535
Other (income) expense 8 (8)
--------- ---------
Income before income tax 4,153 2,747
Income tax expense 1,622 1,098
--------- ---------
Net income $ 2,531 $ 1,649
========= =========
Earnings per share - basic and diluted $ .12 $ .08
========= =========
Weighted average common shares 20,809 20,805
Weighted average common and common equivalent shares 21,281 21,264
FREE CASH FLOW
Net income $ 2,531 $ 1,649
Plus: Depreciation and amortization 1,716 1,809
Deferred tax provision 665 439
Less: Capital expenditures (2,322) (2,521)
--------- ---------
Free cash flow $ 2,590 $ 1,376
========= =========
BALANCE SHEET DATA
Working capital $ 24,048 $ 1,290
Net fixed assets 63,418 60,919
Net intangible and other assets 164,094 144,910
Total assets 265,835 238,467
Long term debt (including current portion of $18
and $17,840, respectively) 121,178 114,123
Stockholders' equity 109,508 94,930
(*) Excluding depreciation, amortization, and corporate general and
administrative
SAGA COMMUNICATIONS, INC.
SELECTED SUPPLEMENTAL FINANCIAL DATA
FOR THE THREE MONTHS ENDED
MARCH 31, 2004 AND 2003
(AMOUNTS IN 000'S EXCEPT PER SHARE DATA)
(UNAUDITED)
AS-REPORTED SAME STATION PRO FORMA(1)
CONSOLIDATED THREE MONTHS ENDED THREE MONTHS ENDED THREE MONTHS ENDED
MARCH 31, MARCH 31, MARCH 31,
2004 2003 2004 2003 2004 2003
-------- -------- -------- -------- -------- --------
Net operating revenue $ 29,173 $ 26,141 $ 28,233 $ 26,132 $ 29,513 $ 27,382
Station operating expense 20,518 18,813 19,735 18,810 20,702 20,063
-------- -------- -------- -------- -------- --------
Station operating income (2) 8,655 7,328 8,498 7,322 8,811 7,319
Corporate general and administrative 1,683 1,245 1,683 1,245 1,683 1,245
Depreciation 1,674 1,719 1,609 1,719 1,680 1,756
Amortization 42 90 42 90 42 107
-------- -------- -------- -------- -------- --------
Operating income 5,256 4,274 $ 5,164 $ 4,268 5,406 4,211
Interest expense 1,095 1,535 1,095 1,607
Other (income) expense, net 8 (8) 8 (8)
Income tax expense 1,622 1,098 1,686 1,040
-------- -------- -------- --------
Net income $ 2,531 $ 1,649 $ 2,617 $ 1,572
======== ======== ======== ========
Earnings per share:
Basic $ 0.12 $ 0.08 $ 0.13 $ 0.08
======== ======== ======== ========
Diluted $ 0.12 $ 0.08 $ 0.12 $ 0.07
======== ======== ======== ========
AS-REPORTED SAME STATION PRO FORMA(1)
RADIO SEGMENT THREE MONTHS ENDED THREE MONTHS ENDED THREE MONTHS ENDED
MARCH 31, MARCH 31, MARCH 31,
2004 2003 2004 2003 2004 2003
-------- -------- -------- -------- -------- --------
Net operating revenue $ 26,019 $ 23,525 $ 25,257 $ 23,516 $ 26,359 $ 24,766
Station operating expense 17,897 16,529 17,294 16,526 18,081 17,779
-------- -------- -------- -------- -------- --------
Station operating income (2) 8,122 6,996 7,963 6,990 8,278 6,987
Depreciation 1,214 1,281 1,149 1,281 1,220 1,318
Amortization 38 86 38 86 38 103
-------- -------- -------- -------- -------- --------
Operating income $ 6,870 $ 5,629 $ 6,776 $ 5,623 $ 7,020 $ 5,566
AS-REPORTED SAME STATION PRO FORMA(1)
TELEVISION SEGMENT THREE MONTHS ENDED THREE MONTHS ENDED THREE MONTHS ENDED
MARCH 31, MARCH 31, MARCH 31,
2004 2003 2004 2003 2004 2003
-------- -------- -------- -------- -------- --------
Net operating revenue $ 3,154 $ 2,616 $ 2,976 $ 2,616 $ 3,154 $ 2,616
Station operating expense 2,621 2,284 2,441 2,284 2,621 2,284
-------- -------- -------- -------- -------- --------
Station operating income (2) 533 332 535 332 533 332
Depreciation 411 388 411 388 411 388
Amortization 4 4 4 4 4 4
-------- -------- -------- -------- -------- --------
Operating income (loss) $ 118 $ (60) $ 120 $ (60) $ 118 $ (60)
(1) Pro Forma results assume all acquisitions and dispositions in 2003 and 2004
occurred as of January 1, 2003.
(2) Excludes depreciation, amortization, corporate general and administrative.
SAGA COMMUNICATIONS, INC.
SELECTED SUPPLEMENTAL FINANCIAL DATA
FOR THE THREE MONTHS ENDED
MARCH 31, 2004 AND 2003
(AMOUNTS IN 000'S EXCEPT PER SHARE DATA)
(UNAUDITED)
PRO FORMA (1) PRO FORMA (1) PRO FORMA (1)
PRO FORMA (1) THREE MONTHS THREE MONTHS THREE MONTHS
CONSOLIDATED THREE MONTHS ENDED ENDED ENDED ENDED
MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31,
2004 2003 2003 2003 2003
-------- -------- ------------- ------------- -------------
Net operating revenue $ 29,513 $ 27,382 $ 33,539 $ 31,697 $ 33,643
Station operating expense 20,702 20,063 21,643 20,047 21,909
-------- -------- ------------- ------------- -------------
Station operating income (2) 8,811 7,319 11,896 11,650 11,734
Corporate general and administrative 1,683 1,245 1,896 1,794 1,515
Depreciation 1,680 1,756 1,712 1,598 1,600
Amortization 42 107 135 140 128
-------- -------- ------------- ------------- -------------
Operating income 5,406 4,211 8,153 8,118 8,491
Interest expense 1,095 1,607 1,229 1,154 1,006
Other (income) expense, net 8 (8) (357) 1,215 281
Income tax expense 1,686 1,040 2,780 2,324 2,708
-------- -------- ------------- ------------- -------------
Net income $ 2,617 $ 1,572 $ 4,501 $ 3,425 $ 4,496
======== ======== ============= ============= =============
Earnings per share:
Basic $ 0.13 $ 0.08 $ 0.22 $ 0.16 $ 0.22
======== ======== ============= ============= =============
Diluted $ 0.12 $ 0.07 $ 0.21 $ 0.16 $ 0.21
======== ======== ============= ============= =============
PRO FORMA (1) PRO FORMA (1) PRO FORMA (1)
PRO FORMA (1) THREE MONTHS THREE MONTHS THREE MONTHS
RADIO SEGMENT THREE MONTHS ENDED ENDED ENDED ENDED
MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31,
2004 2003 2003 2003 2003
-------- -------- ------------- ------------- -------------
Net operating revenue $ 26,359 $ 24,766 $ 30,424 $ 28,634 $ 30,205
Station operating expense 18,081 17,779 19,223 17,726 19,339
-------- -------- ------------- ------------- -------------
Station operating income (2) 8,278 6,987 11,201 10,908 10,866
Depreciation 1,220 1,318 1,275 1,199 1,115
Amortization 38 103 132 136 125
-------- -------- ------------- ------------- -------------
Operating income $ 7,020 $ 5,566 $ 9,794 $ 9,573 $ 9,626
PRO FORMA (1) PRO FORMA (1) PRO FORMA (1)
PRO FORMA (1) THREE MONTHS THREE MONTHS THREE MONTHS
TELEVISION SEGMENT THREE MONTHS ENDED ENDED ENDED ENDED
MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31,
2004 2003 2003 2003 2003
-------- -------- ------------- ------------- -------------
Net operating revenue $ 3,154 $ 2,616 $ 3,115 $ 3,063 $ 3,438
Station operating expense 2,621 2,284 2,420 2,321 2,570
-------- -------- ------------- ------------- -------------
Station operating income (2) 533 332 695 742 868
Depreciation 411 388 388 349 435
Amortization 4 4 3 4 3
-------- -------- ------------- ------------- -------------
Operating income (loss) $ 118 $ (60) $ 304 $ 389 $ 430
(1) Pro Forma results assume all acquisitions and dispositions in 2003 and 2004
occurred as of January 1, 2003.
(2) Excludes depreciation, amortization, corporate general and administrative.
SAGA COMMUNICATIONS, INC.
SELECTED FINANCIAL DATA NON-GAAP DISCLOSURES
FOR THE THREE MONTHS ENDED
MARCH 31, 2004 AND 2003
(AMOUNTS IN 000'S EXCEPT PER SHARE DATA)
(UNAUDITED)
RECONCILIATION OF STATION OPERATING INCOME TO GAAP OPERATING INCOME (LOSS)
AS-REPORTED SAME STATION PRO FORMA(1)
CONSOLIDATED THREE MONTHS ENDED THREE MONTHS ENDED THREE MONTHS ENDED
MARCH 31, MARCH 31, MARCH 31,
2004 2003 2004 2003 2004 2003
-------- -------- -------- -------- -------- --------
Operating income as reported $ 5,256 $ 4,274 $ 5,164 $ 4,268 $ 5,406 $ 4,211
Corporate general and administrative 1,683 1,245 1,683 1,245 1,683 1,245
Depreciation 1,674 1,719 1,609 1,719 1,680 1,756
Amortization 42 90 42 90 42 107
-------- -------- -------- -------- -------- --------
Station operating income $ 8,655 $ 7,328 $ 8,498 $ 7,322 $ 8,811 $ 7,319
======== ======== ======== ======== ======== ========
AS-REPORTED SAME STATION PRO FORMA(1)
RADIO SEGMENT THREE MONTHS ENDED THREE MONTHS ENDED THREE MONTHS ENDED
MARCH 31, MARCH 31, MARCH 31,
2004 2003 2004 2003 2004 2003
-------- -------- -------- -------- -------- --------
Operating income as reported $ 6,870 $ 5,629 $ 6,776 $ 5,623 $ 7,020 $ 5,566
Corporate general and administrative -- -- -- -- -- --
Depreciation 1,214 1,281 1,149 1,281 1,220 1,318
Amortization 38 86 38 86 38 103
-------- -------- -------- -------- -------- --------
Station operating income $ 8,122 $ 6,996 $ 7,963 $ 6,990 $ 8,278 $ 6,987
======== ======== ======== ======== ======== ========
AS-REPORTED SAME STATION PRO FORMA(1)
TELEVISION SEGMENT THREE MONTHS ENDED THREE MONTHS ENDED THREE MONTHS ENDED
MARCH 31, MARCH 31, MARCH 31,
2004 2003 2004 2003 2004 2003
-------- -------- -------- -------- -------- --------
Operating income (loss) as reported $ 118 $ (60) $ 120 $ (60) $ 118 $ (60)
Corporate general and administrative -- -- -- -- -- --
Depreciation 411 388 411 388 411 388
Amortization 4 4 4 4 4 4
-------- -------- -------- -------- -------- --------
Station operating income $ 533 $ 332 $ 535 $ 332 $ 533 $ 332
======== ======== ======== ======== ======== ========
(1) Pro Forma results assume all acquisitions and dispositions in 2003 and 2004
occurred as of January 1, 2003.
SAGA COMMUNICATIONS, INC.
SELECTED FINANCIAL DATA NON-GAAP DISCLOSURES
FOR THE THREE MONTHS ENDED
MARCH 31, 2004 AND 2003
(AMOUNTS IN 000'S EXCEPT PER SHARE DATA)
(UNAUDITED)
RECONCILIATION OF PRO FORMA STATION OPERATING INCOME TO GAAP PRO FORMA OPERATING
INCOME (LOSS)
PRO FORMA (1) PRO FORMA (1) PRO FORMA (1)
PRO FORMA (1) THREE MONTHS THREE MONTHS THREE MONTHS
CONSOLIDATED THREE MONTHS ENDED ENDED ENDED ENDED
MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31,
2004 2003 2003 2003 2003
-------- -------- ------------- ------------- -------------
Pro forma operating income as reported $ 5,406 $ 4,211 $ 8,153 $ 8,118 $ 8,491
Corporate general and administrative 1,683 1,245 1,896 1,794 1,515
Depreciation 1,680 1,756 1,712 1,598 1,600
Amortization 42 107 135 140 128
-------- -------- ------------- ------------- -------------
Pro forma station operating income $ 8,811 $ 7,319 $ 11,896 $ 11,650 $ 11,734
======== ======== ============= ============= =============
PRO FORMA (1) PRO FORMA (1) PRO FORMA (1)
PRO FORMA (1) THREE MONTHS THREE MONTHS THREE MONTHS
RADIO SEGMENT THREE MONTHS ENDED ENDED ENDED ENDED
MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31,
2004 2003 2003 2003 2003
-------- -------- ------------- ------------- -------------
Pro forma operating income as reported $ 7,020 $ 5,566 $ 9,794 $ 9,573 $ 9,626
Corporate general and administrative -- -- -- -- --
Depreciation 1,220 1,318 1,275 1,199 1,115
Amortization 38 103 132 136 125
-------- -------- ------------- ------------- -------------
Pro forma station operating income $ 8,278 $ 6,987 $ 11,201 $ 10,908 $ 10,866
======== ======== ============= ============= =============
PRO FORMA (1) PRO FORMA (1) PRO FORMA (1)
PRO FORMA (1) THREE MONTHS THREE MONTHS THREE MONTHS
TELEVISION SEGMENT THREE MONTHS ENDED ENDED ENDED ENDED
MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31,
2004 2003 2003 2003 2003
-------- -------- ------------- ------------- -------------
Pro forma operating income (loss) as reported $ 118 $ (60) $ 304 $ 389 $ 430
Corporate general and administrative -- -- -- -- --
Depreciation 411 388 388 349 435
Amortization 4 4 3 4 3
-------- -------- ------------- ------------- -------------
Pro forma station operating income $ 533 $ 332 $ 695 $ 742 $ 868
======== ======== ============= ============= =============
(1) Pro Forma results assume all acquisitions and dispositions in 2003 and 2004
occurred as of January 1, 2003.
SAGA COMMUNICATIONS, INC.
SELECTED FINANCIAL DATA NON-GAAP DISCLOSURES
FOR THE THREE MONTHS ENDED
MARCH 31, 2004 AND 2003
(AMOUNTS IN 000'S EXCEPT PER SHARE DATA)
(UNAUDITED)
RECONCILIATION OF SAME STATION STATION OPERATING INCOME TO GAAP OPERATING INCOME
(LOSS)
ADJUSTMENT ADJUSTMENT
AS-REPORTED FOR ACQUISITIONS SAME STATION AS-REPORTED FOR ACQUISITIONS SAME STATION
THREE MONTHS AND DISPOSITIONS THREE MONTHS THREE MONTHS AND DISPOSITIONS THREE MONTHS
CONSOLIDATED ENDED NOT INCLUDED IN ENDED ENDED NOT INCLUDED IN ENDED
MARCH 31, ENTIRE COMPARABLE MARCH 31, MARCH 31, ENTIRE COMPARABLE MARCH 31,
2004 PERIOD 2004 2003 PERIOD 2003
------------ ----------------- ------------ ------------ ----------------- ------------
Net operating revenue $ 29,173 $ (940) $ 28,233 $ 26,141 $ (9) $ 26,132
Station operating expense 20,518 (783) 19,735 18,813 (3) 18,810
------------ ----------------- ------------ ------------ ----------------- ------------
Station operating income (2)
administrative 8,655 (157) 8,498 7,328 (6) 7,322
Corporate general and 1,683 -- 1,683 1,245 -- 1,245
Depreciation 1,674 (65) 1,609 1,719 0 1,719
Amortization 42 0 42 90 -- 90
------------ ----------------- ----------- ------------ ----------------- ------------
Operating income (loss) $ 5,256 $ (92) $ 5,164 $ 4,274 $ (6) $ 4,268
============ ================= =========== ============ ================= ============
ADJUSTMENT ADJUSTMENT
AS-REPORTED FOR ACQUISITIONS SAME STATION AS-REPORTED FOR ACQUISITIONS SAME STATION
THREE MONTHS AND DISPOSITIONS THREE MONTHS THREE MONTHS AND DISPOSITIONS THREE MONTHS
RADIO SEGMENT ENDED NOT INCLUDED IN ENDED ENDED NOT INCLUDED IN ENDED
MARCH 31, ENTIRE COMPARABLE MARCH 31, MARCH 31, ENTIRE COMPARABLE MARCH 31,
2004 PERIOD 2004 2003 PERIOD 2003
------------ ----------------- ------------ ------------ ----------------- ------------
Net operating revenue $ 26,019 $ (762) $ 25,257 $ 23,525 $ (9) $ 23,516
Station operating expense 17,897 (603) 17,294 16,529 (3) 16,526
------------ ----------------- ----------- ------------ ----------------- ------------
Station operating income (2) 8,122 (159) 7,963 6,996 (6) 6,990
Corporate general and
administrative -- -- -- -- -- --
Depreciation 1,214 (65) 1,149 1,281 0 1,281
Amortization 38 0 38 86 -- 86
------------ ----------------- ----------- ------------ ----------------- ------------
Operating income (loss) $ 6,870 $ (94) $ 6,776 $ 5,629 $ (6) $ 5,623
============ ================= =========== ============ ================= ============
ADJUSTMENT ADJUSTMENT
AS-REPORTED FOR ACQUISITIONS SAME STATION AS-REPORTED FOR ACQUISITIONS SAME STATION
THREE MONTHS AND DISPOSITIONS THREE MONTHS THREE MONTHS AND DISPOSITIONS THREE MONTHS
TELEVISION SEGMENT ENDED NOT INCLUDED IN ENDED ENDED NOT INCLUDED IN ENDED
MARCH 31, ENTIRE COMPARABLE MARCH 31, MARCH 31, ENTIRE COMPARABLE MARCH 31,
2004 PERIOD 2004 2003 PERIOD 2003
------------ ----------------- ------------ ------------ ----------------- ------------
Net operating revenue $ 3,154 $ (178) $ 2,976 $ 2,616 $ 0 $ 2,616
Station operating expense 2,621 (180) 2,441 2,284 0 2,284
------------ ----------------- ------------ ------------ ----------------- ------------
Station operating income (2) 533 2 535 332 -- 332
Corporate general and
administrative -- -- -- -- -- --
Depreciation 411 -- 411 388 -- 388
Amortization 4 -- 4 4 -- 4
------------ ----------------- ----------- ------------ ----------------- ------------
Operating income (loss) $ 118 $ 2 $ 120 $ (60) $ 0 $ (60)
============ ================= =========== ============ ================= ============
(2) Excludes depreciation, amortization, corporate general and administrative.